BusinessDay – Debt advisers take taxi owners for ride

taxi!

Image by decodrama visual via Flickr

LITERALLY “thousands” of taxi operators had been involved in “clear abuse” of the debt-review process as laid out under the National Credit Act, using the process as a payment holiday, senior WesBank executives said this week.

This would indicate the extent to which banks initially struggled to implement the act when it was introduced in 2007.

Chris de Kock, head of sales and marketing at WesBank, said taxi owners qualified for the debt-review process as “sole entities”, but this was “quite ridiculous”. He said thousands of taxi owners had sought debt relief under the scheme.

Under the National Credit Act indebted individuals struggling with repayments are allowed to approach their creditors through a debt counsellor with a proposal for reduced repayments or extended terms. This “locks” the account for 60 days while the creditor studies the proposal.

“It was clearly just abuse. We saw a lot of it. You could see the debt counsellors at the taxi ranks, where they would approach drivers and try to persuade them to get into the process. The way we saw it, if they were in genuine difficulties then they should have closed their businesses,” Mr de Kock said.

Imtiaz Cassim, head of taxi finance at WesBank, confirmed the extent of the problem. “Debt counsellors saw an opportunity to make some money. They lured taxi operators, who are often semiliterate and therefore very vulnerable, into a process they didn’t understand,” Mr Cassim said yesterday.

via BusinessDay – Debt advisers take taxi owners for ride.

Strange Random Taxi Quote:

“Too bad all the people who know how to run the country are busy driving taxi cabs and cutting hair” – George Burns (American comedian 1896-1996)

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Posted on September 3, 2011, in Article and tagged , , , , , , , , , . Bookmark the permalink. Leave a comment.

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