Give Credit where credit is due
Give credit where credit is due
Phrases such as Black-Listing, credit profile and Credit Bureaux are known to us but it would appear that very few people know how these concepts affect our day to day lives. With the National Credit Act being around since 2006 there still seems to be a misconception regarding our rights as consumers, toward our personal credit profiles and status.
In the next issues we will address these concepts to remove some of the fear and trepidation associated with them. We all need to know that as credit consumers we have more rights now then in the past.
What is a Credit Bureau?
In essence Credit Bureaux are private companies that store, process and evaluate financial data collected from third parties. A private individual may not operate as a Credit Bureau. The information collected is, in its filtered and evaluated form, made available to various credit providers, for example banking institutions, in order to prevent over-indebtedness and the granting of reckless credit.
In other words the credit information, held by the Credit Bureaux, is used to determine your personal credit status and credit risk profile. This snapshot of your credit history is provided to a Credit Provider whenever it wants to do business with you.
There are a number of registered Credit Bureaux in South Africa are defined by the type of data they collect or by the credit industry they service. The two most common, dealing primarily with private individuals, are TransUnion (www.transunion.co.za) and Experian (www.experian.co.za). The credit data they hold is in electronic form and is known as a Credit Report.
Who is listed with a Credit Bureau?
Every private individual being credit active, will already be listed with the one of the Credit Bureaux. This information held in a Credit Report is regulated by Section 70(1) of the National Credit Act and can include a person’s credit history, assets, debts, patterns of payment, and default information.
However, just because you have a file with Credit Bureaux doesn't mean that it's all bad news. A Credit Bureau is obligated to only publish true and correct information about your credit history but errors do occur. Whenever possible update your information, which should be done at least once a year. If you find anything in your Credit Report that is incorrect you have the right to challenge such information and have your report corrected.
How does the Credit Bureau help me?
We all need to exercise responsible credit management, in fact TransUnion have taken active steps to educate consumers through Consumer Education Programmes in partnership with the Credit Bureau Association (CBA).
But sometimes life happens, errors occur and suddenly a debit order is being returned as unpaid. At times like these your up-to-date information stored with the Credit Bureaux comes in handy as your Credit Provider is able to find and contact you without delay to inform you of the error. This will prevent unnecessary legal steps being taken against you and legal costs being billed against you.
How do I find my Credit Profile?
The best place to start is to hit the internet. As most Credit Bureaux exchange information with each other and in terms of Section 70(2)(a) of the National Credit Act a Credit Bureau is obligated to accept and file information received from a Credit Provider, any update to your personal information will eventually filter its way to the other Credit Bureaux.
Draw your credit profile. This is not a totally free service however a Credit Bureau will supply you with one free printout of you Credit Record each year and/or per twelve month cycle. Once you have received your report update your personal information. In next months issue we will address the steps to be followed if you find you have been “Black-Listed”.
The above is an introduction to the concept of Credit Bureaux. It is recommended that you consult your attorney before making any decisions based on the information supplied. If you are an RMI4 Law member you can contact the legal assistance line for further information on the topic discussed on 0861 668 677. Contribution by: Wesley Watson LLB (UNISA), Barnard Incorporated Attorneys.
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