Credit Bureau & Dispute Process
Background
The National Credit Act 34/2005 (NCA) and the National Credit Regulator (NCR) became operational on 1 June 2006. The National Credit Regulator is responsible for the enforcement of the Act.
What is a credit bureau?
A credit bureau is a company that gathers information and updates each consumer’s credit history. A credit bureau creates a record of a consumer’s credit information indicating how the consumer manages his/her credit.
The credit bureau supplies these records to credit providers, such as banks, retailers and other credit providing companies. The information indicates each consumer’s payment record. It is also used to detect fraud, corruption or theft.
What does the Act do?
The Act stipulates that each credit bureau must register with the National Credit Regulator in order to conduct business legally;
It sets out the purposes for which consumer credit information may be used, and the companies to which the credit bureau may provide the information;
It sets out standards for data accuracy to ensure that information kept by a credit bureau on your record is always accurate;
It ensures that each consumer has the right to check his or her record, and that any mistakes are corrected.
What rights do I have?
You have the right:
To be informed that the credit provider intends to report negative information on you to a credit bureau before the credit provider actually reports you;
To receive a copy of your credit record from a credit bureau when you request it. You can get one free record per year, but the credit bureau may charge you a fee for any further records;
To challenge information kept by the credit bureau if you are unhappy with the information;
For your information to be kept confidential, and for your information to be used only for purposes allowed by the Act.
What can my credit information be used for?
Your credit information can be used:
To assess whether or not you can afford credit;
To investigate fraud, corruption or theft;
To consider you for employment in a position that requires trust and honesty and entails the handling of cash or finances; and to assess whether or not you can afford various services.
Credit information assists credit providers to assess if consumers will be able to meet their financial obligations. Credit information is of benefit to consumers who are not over indebted and have good payment histories. Credit information assists such consumers to get credit, and prevents them from becoming over-indebted.
Will I be notified before the information is sent to the bureau?
For the following information, you will receive 20 business days notice before a credit provider submits your information to a credit bureau.
During this period, you must inform the credit provider or credit bureau if the information is incorrect: classifications of consumer behaviour, such as ‘delinquent’, ‘default’, ‘slow paying’, ‘absconded’ or ‘not contactable’; classifications related to enforcement action taken by the credit provider, such as handed over for collection or recovery, legal action, or write-off.
Can I challenge information kept by credit bureau if I don’t agree with it?
YES! If you do not agree with the information held by the credit bureau, you can challenge this and request the bureau to correct the information. If they refuse to correct the information, you can complain to the National Credit Regulator.
When I apply for credit from a credit provider, who decides whether or not I qualify for credit?
When you apply for credit, the credit provider uses information received from a credit bureau to assess your application. When your credit record satisfies the standards of the credit provider, a decision to grant you credit is made by the credit provider. It is the bank, retailer or credit provider that approves or rejects the credit application and not the credit bureau.
Credit bureau may not list information that may be discriminatory such as information on race, sexuality, political affiliation, medical status, religion or membership with a trade union.
How can I get a copy of my credit record?
You can request your credit record from a credit bureau once a year at no charge, thereafter at a fee of not more than R25 per record.
The Office of the Credit Information Ombud
The office of the Credit Information Ombud resolves complaints from consumers and businesses that are negatively impacted by credit information.
How can I verify that the information held by credit bureau is accurate?
You can verify that the information held by a credit bureau is correct by following the steps below:
Contact the credit bureau; Ensure that you have your accurate personal information such as your ID number and your address; the bureau will send you a form to complete; complete the form and fax it to the bureau;
The credit bureau may ask you to pay a fee; this must not exceed R25;
Inform the bureau if there is any inaccurate information on your record, or ask the bureau to explain any information where you are uncertain.
