Task team to solve debt review challenges

The task team will initially focus on ‘quick wins' and is anticipated to have a lifespan of about six months. The task team comprises of Peter Setou, Paul Slot, Johan de Ridder and Rob Easton-Berry and is chaired by Advocate Neville Melville, whose experience as former Banking Ombudsman and dispute resolution expert is seen by the NCR as critical in mediating between the different parties. Marlene Heymans (NCR) and Marissa Erasmus of the University of Pretoria Law Clinic assist the team.

According to the regulator's statistics, the number of consumers who have applied for debt counselling has risen to 130 000. On average, 9000 new consumers apply for debt counselling per month. This is likely to increase in the coming months and it is urgent that an interim solution be found whilst industry awaits changes to the legislation.

Task team objectives

• Identify primary causes of current backlogs and delays in finalising debt restructuring
  
• Propose common standards and procedures, which would facilitate the processing and finalisation of applications for debt counselling
  
• Establish mechanisms through which credit providers, debt counsellors and payment distribution agents can engage on operational and procedural problems with the implementation of debt restructuring proposals
  
• Establish mechanisms through which disputes in relation to specific cases can be resolved
  
• Provide regular information through circulars or similar mechanisms to credit providers and debt counsellors on any standard procedures or documentation
  
• Assist and advise NCR with the objective of implementing an effective debt counselling process, as intended by the National Credit Act.

“While it was to be expected that there would be teething problems in implementing the National Credit Act (NCA), the only one of its kind worldwide, we decided we needed to act decisively to bring the situation under control,” said Gabriel Davel, the CEO of the NCR.

Advocate Melville welcomed the spirit of commitment displayed by members of the task team and their determination to resolve the problem. He is hopeful that it will be able to bring about a significant improvement in the backlogs that are negatively affecting consumers and creating increasing risk to credit providers, particularly the banking industry.