WALVIS BAY - Discrepancies in bank charges concerning loans and despotic increases on defaulting consumers were some of the concerns raised at a public consultation on the proposed Consumer Credit Bill, an exercise spearheaded by the Namibia Financial Institutions Supervisory Authority (Namfisa).
The authority is currently conducting nationwide consultations on the draft law that seeks to, amongst others, enhance consumer protection as far as it relates to financial services issued by non-banking companies.
These consultations give an opportunity to credit providers, such as microlenders, banks, retail stores offering credit, pawn shops, debt collectors, credit bureaus and individuals who use credit to add their voices. “The purpose of the Bill is to promote fair, transparent and responsible market conduct in the consumer credit market, where consumers of credit are protected. This Bill also speaks about treating customers fairly, and that you don’t sell products such as insurance when there is no risk,” Namfisa’s Christofina Shindume noted.
She added that the Bill is benchmarked against countries such as South Africa, whose environment is relatable to Namibia.
Shindume said the Bill will apply to all types of credit, and will give regulators such as Namfisa a bird’s eye view over the sector.
In its current format, the Bill empowers the finance minister and consumer credit regulators to issue regulations and standards for purposes of due implementation.
Those who attended the meeting raised
concerns over the fact that financial institutions, especially banks and retailers in some instances, raise their credit without any notification or seeking
approval from the consumer.
“We also have instances that some micro-lenders, despite carrying out payroll deductions, continue to charge consumers insurance that is separately billed. The inexplicable interest that we pay to some credit facilities are a huge concern as it results in consumers being blacklisted,” said one of the attendees.
Responding to the concerns, Shindume said the current Bill “speaks about treating consumers fairly by not selling products they don’t need.” “However, the consumer must also take accountability. You don’t have to take out a loan or insurance. Instead, rather take your time and see what suits your needs better,” she advised.