The DIT recently put out for comment an increase in the fee Debt Counsellors (and others) have to pay each year to the NCR in regard to their registrations. This annual renewal fee has been R100 for many years now. The recent draft document saw a proposal of pushing that cost up drastically to R500. Various concerned parties commented, including the Debt Counsellors Association of South Africa (DCASA) who suggested a more moderate increase. They were not alone in their suggestions as many in the industry felt that such a huge increase was not warranted.
The DTI have now issued the new fee regulations in regard to renewals in the government Gazette and the figure which has come back is actually higher than they had first proposed. As of this month Debt Counsellors who want to renew their certification will have to pay R550 / annum.The NCR has recently taken upon themselves the mammoth task of not only issuing each Debt Counsellor a certificate when qualifying and being registered but issuing printed copies of certificates to all registered parties each year (with a year date). The NCr has in the past had a reputation for the long turn around times from application to registration. They now also face a challenge in that the DTI has changed the definition of a credit provider (who would then need to be registered and receive certificates) to a much broader definition as anyone who lends anyone else money and charges any fee or interest on the amount. This is no doubt in an effort to clamp down on small loan sharks.
The adjustment of the fee to such a remarkably high amount is probably tied into the desperate need the NCR will have to cover additional printing, shipping and organising costs in tracking who has their “current” certificate. They will no doubt need to take on many additional staff to facilitate this new process. If they do not do so then disaster lurks on the horizon.
Additionally it seems to many that the NCR hope to see the many, many registered non practicing DCs cancel their registration or not pay so that they do not to monitor them. Sadly this may be the case, meaning less people will be able to assist troubled consumers (without going through the application process again which as mentioned is incredibly time consuming for some reason). At present of the thousands of people who have qualified few practice as they find it to be unprofitable or too complicated and difficult. This whole thing does somewhat have all the hall marks of a plan which may backfire…Let’s hope not.
One DC reported that this week he received his certificate from the NCR. Sadly the annual expiry date was the day following the day he received it. This means he could only practice for 24hrs before needing his next certificate. It seems it was on back order for a long, long time. Maybe it was just a glitch in the new system.Though there has been a declaratory judgement on the matter some courts still ask that the Debt Counsellor include proof of being up to date with the NCR. This comes into effect when the court case drags on and the certification on file expires meanwhile and needs to be updated. Should the NCR delay the court case may be thrown out. The consumer might then sue the Debt Counsellor who in turn would not easily be able to take action against the NCR. This may then leave the Debt Counsellor and consumer in a world of trouble. Imagine if a consumer’s home is lost as a result of a bad combination of a debt review court case thrown out and an unreasonable credit provider pursuing additional legal action due to the debt review falling apart.
It remains to be seen if the NCR can deliver on their plan. Of course, this is all additional unwarranted work which could rather have continued with a simple proof of payment/receipt of payment process. Some even question the legality of this new enhanced process. More on that in this months Debtfree Magazine.
Source – www.debtfreedigi.co.za/