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Don’t be misled by companies offering to write off your debt

The Debt Counselling Group SA shares examples of the type of quick-fix scams being circulated via SMS and on social media

Many consumers are convinced by misleading adverts that there’s a quick fix for their debt problems.
Many consumers are convinced by misleading adverts that there’s a quick fix for their debt problems.
Image: Supplied/DCGSA

Waking up after a bad night’s sleep, worrying about financial commitments that are impossible to meet this month, can send you looking for quick fixes for your debt problems. 

However, even if your debt feels overwhelming, it’s important not to be misled by companies promising unrealistic and speedy solutions.

The National Credit Regulator (NCR) sent out a recent circular stating it had “noted with concern” the trend of some debt counsellors to use misleading advertising tactics to market their services, particularly on social media platforms such as Facebook.

“The advertisements are misleading in nature in that they misrepresent the spirit and objectives of the National Credit Act regarding the provisions of debt counselling as a debt relief measure,” wrote the NCR.

“Consequently, they bring debt counselling into disrepute, give it a bad name and undermine the efforts made by debt counsellors who genuinely put the interests of overindebted consumers first.”

Here are just four examples of the types of misleading adverts you may come across on social media or be sent via SMS:

  • There is a new High Court ruling helping people in debt write off up to 63% of their monthly payments. Click “Apply Now” to take the FREE assessment.
  • DEBT RELIEF — High Court ruling frees South Africans in debt. TAP “SEND MESSAGE”. (This advert includes a picture of President Cyril Ramaphosa).
  • NCR DC is giving South Africans “Extra Cash” to enjoy by reducing debt interest and protection from repossession of assets. Free assessment sms “YES”.
  • There is government proclamation on cancellation of debts; and We will attend to your legal and debt review flag removal in 20 working days with or without a court order.

Another worrying trend to look out for are scams that promise “debt intervention” in terms of the National Credit Amendment Act (Act No 7 of 2019).

Here are the facts: 

  • Though Ramaphosa signed the National Credit Amendment Act in August 2019, it awaits an implementation date to be promulgated. This means it is not in operation yet. 
  • Consumers will only be assisted for debt intervention once the amendment act has been promulgated by the president.

There are many companies asking for upfront fees to assist you through the debt intervention process or in writing off your debt. Before you make any payments or enter into any agreements, verify such information with the NCR by calling 086-062-7627.

The Debt Counselling Group SA can help with your debt-related questions. Email help@dcgsa.co.za or visit dcgsa.co.za

About the author: Casper le Grange is a debt counsellor registered with the NCR.

This article was paid for by the Debt Counselling Group SA.