The Debt Intervention Bill is a new piece of legislation and the purpose is to get low-income earners who are stuck in the debt trap out of debt.
This piece of legislation has not been passed yet, so it may or may not go forward, or there might be some changes, but it is very likely to go forward, even if a few things are changed, but it will only start when the president has signed it.
Normally I would wait until the legislation is passed and final and signed and sealed before I would discuss it. However, there are already some fraudsters out there who are ripping people off trying to convince them that they are agents for debt intervention, so-called “debt intervention counsellors”.
Many people have heard of it and read about it in the newspapers or listened to a report on the news, so if someone approaches you, you are more likely to believe them.
If you get a call or are approached by someone who says that they have been selected to help you with debt intervention, then they are not telling the truth. Do not pay them any money, do not give them any details especially not your personal details and definitely not your bank details. Be careful, there are a lot of fraudsters out there and we all have to be more and more aware of our bank and personal details.
The Debt Intervention Bill started many years ago, and since last year they have been doing public participation sessions. I went with DCASA (the Debt Counsellors Association of South Africa), to parliament in January this year to make submissions on how we thought the Bill should be written and we made our submissions to the DTI (Department of Trade and Industry ) sub-committee whose job it is to get the bill to parliament.
All the major banks were there, the micro-finance industry was there and many others who were interested in presenting how we thought the Bill should work, and here is what the DTI subcommittee came up with:
The Bill will only apply to people who earn less than R7 500 per month, and have debt of less than R50 000.
So, if you earn R7 600 or your debt is R51 000 you are excluded from this bill.
Another aspect of this bill is that debt can be written off. If someone has lost their job and over a period they struggle to find employment and can’t pay their debt, the bill makes allowance for all or a portion of that debt to be written off.
Now of course, this is the part that everyone is talking about. I’ve heard people say: “don’t worry to pay your debt, next year the government will write it off”. This is very irresponsible and for the majority of people, we don’t even qualify to be considered to have debt written off.
Obviously this does not please the banks or the furniture or clothing retailers or the micro-lenders, so there is a good chance that they will fight it in court as soon as it comes out which could delay the implementation even further,
If anyone approaches you and says they are agents or debt intervention counsellors for debt intervention do not pay them anything and especially do not give them your personal or bank details.
It only applies to people earning R7500 or less per month and debt of under R50 000. If you earn more and have financial problems, then a debt counsellor is the person to talk to.
A short summary of the Debt Intervention Bill
If you need to contact a debt counsellor, contact us. We are registered debt counsellors in Johannesburg, South Africa.
