Avoid falling into fake credit providers’ trap
Consumers need to be vigilant as scams target the financially distressed
The National Credit Regulator (NCR) warns consumers to be wary of fake credit providers who attempt to entrap consumers in loan scams.
Jacqueline Peters, a manager at the department of investigations and enforcement, said these scams typically target those who are in distressed financial circumstances and looking for a loan, using slogans such as “blacklisted” or “debt review clients welcome”.
Peters said the increase in these types of scams comes at a time when credit approvals have decreased and consumers are financially stretched.
“This is the time to be more vigilant as it is in the vulnerable times that we should make wise decisions,” Peters said.
She said the National Credit Act (NCA) prohibited advertisements for credit from using these terms and consumers should avoid engaging with any credit provider who advertises in this manner.
She gave the following handy tips to avoid scams:
Treat all unexpected calls, e-mails and SMS messages with caution. Don’t assume they are genuine, even if the person seems to know some basic information about you, such as your name;
Look out for the name on all e-mails, in case it is a “clone company” pretending to be a real credit provider;
Do not pay any upfront fees to release your loans as the NCA does not allow credit providers to request upfront payments for the release of a loan. If the credit provider makes this request, report it to the relevant authorities such as the NCR or the SAPS;
Be aware of platforms and hidden fees included for sourcing a loan;
Don’t be pressured into acting quickly. A genuine credit provider won’t mind waiting if you want time to think and compare the costs of credit using a quotation;
Do not engage with credit providers who do not conduct affordability assessments. Furthermore, never give false or incorrect information on a credit application about your financial affairs. Always disclose your financial obligations and living expenses fully; and
Never borrow from an unregistered credit provider. “If a proposal is too good to be true, it usually is.”
If a consumer is unsure or in doubt about the legitimacy of the credit provider or agreement, they should contact the NCR on (011) 554-2600/2700 or visit their website at www.ncr.org.za.