Debt management is a tricky situation for consumers as they are trying to deal with the financial issues and lack of money on the one hand, but then they are trying to avoid getting into deeper trouble with law enforcement. A big worry for debt afflicted consumers is being blacklisted..
There was a period of time where South African consumer lived in fear of being blacklisted by creditors and when creditors had all the power. Getting into debt was tricky, and getting out of it even more. But the government recognised a need in consumers – they needed debt management advice and the experts to provide it. Thus in 2007 the National Credit Act came into effect. The act served as a safety net for both consumers and creditors. By providing consumers with a legal means to manage their debts in financial dry times, and giving the creditors a chance to stop clenching their fist and shaking them angrily at consumer who weren’t paying their dues.
The National Credit Act, along with certain sections in the Consumer Protection Act has laid out new policies for debt management, with one of the key benefits being debt review. Consumers now have the opportunity to seek out debt management advice from a debt counsellor, who will assist them in negotiations with their creditors and create a path for them to clear their debts in the long run. It is imperative that consumers familiarise themselves with these new developments, as some creditors will still try to exploit or bully them into payments that they cannot afford.
By providing a consumer with quality debt management advice, debt counsellors not only help them out of their current predicament but also assist a consumer in developing a future strategy for when they are rehabilitated and allowed to incur debt again.