OPINION

Do not fall victim to credit scams - fear of blacklist is unfounded

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"Have you been blacklisted?" Chances are you've seen many adverts asking you this question, but rest assured that the answer is always "no". There is no such thing as a blacklist, says Jeannine Viljoen, Executive Manager of the Credit Bureau Association (CBA). "There are a number of companies that claim to be able to clear a consumer's credit report or remove their name from a "blacklist". This is however false advertising and is intended to mislead consumers. These services are also often advertised at exorbitant costs."

The advertisements in question purport that the advertiser can remove anyone with bad credit from a "black list", but in actual fact, many of them purely supply high-interest loans to individuals with poor credit ratings.

In reality, all credit active consumers (currently approximately 22 million) have a profile on the credit bureau and the credit bureaus therefor display both positive and negative information. This means that all information on how well (or poorly) you pay your accounts is reflected on your credit report. "The information that is displayed on your profile is linked to your payment behaviour and how well you manage your obligations. A third party cannot alter this information. The company that you have an account or a loan with supplies information on how well you pay your accounts to the credit bureau. If you have any negative information reflected on your profile it is best to firstly understand where the problems are and to then make contact with bank or retailer to make a payment arrangement," says Viljoen.

Gumtree is fighting back

Gumtree has recently met with the CBA to combat the growing problem of misleading or fraudulent ads appearing on various classifieds that claim to remove individuals from a blacklist or provide credit. According to Claire Cobbledick, Head of Marketing for Gumtree South Africa, the site has implemented strict measures to ensure that their customers are protected. "Safety is of paramount importance. We took immediate action to block keywords and advertisements pertaining to blacklisting and encourage our community to report any ads that make such claims immediately. We are committed to working with organisations such as the Credit Bureau Association to ensure that we are protecting our customers and keeping their best interests in mind."

Viljoen says that cooperation from online classifieds is vitally important, but that consumers should also be aware of the facts surrounding credit. "It is important for classifieds to ensure that they do not publish advertisements that mislead or defraud the public. To this extent Gumtree has gone to great lengths to implement processes to scan and verify that advertisements that do not meet these requirements are not published," she states. "Consumers need to make sure that they understand their rights and that they do not engage with companies that seem doubtful or untrustworthy. Companies who advertise that you will qualify for credit despite having a negative credit bureau report are most probably granting those loans recklessly and if you are already over-indebted or in arrears with some of your loans, you are just worsening your financial position. The National Credit Act prescribes that all credit providers must do a proper affordability assessment (which includes an analysis of your income and your expenditure as well as all your other financial obligations) before they can grant credit. If they are not doing this, they are not acting in your best interest."

Viljoen stressed that there are numerous reputable micro lenders and private lenders, but that due caution is necessary.

Tips for consumers

Viljoen's advice is for consumers to:

* Always verify that the company is registered. Check the website for their registration number.

* Ask for references.

* Never deposit money into a bank account or give someone cash without making sure that the service is legitimate.

* When in doubt reach out for professional advice - contact the credit provider or credit bureau directly to understand your rights.

* Do not hand over your ID or bank card to someone to keep as security for a loan.

Viljoen says that bad credit will not haunt you for life if you are able to settle debt. "Following the 'credit amnesty' all paid up judgments are now removed as soon as you can show that you have settled the debt. As soon as the changes to the National Credit Act become effective, all adverse listings will also be removed. If that does not happen for whatsoever reason, you as the consumer can dispute the information with the credit bureau and provide it with proof that you paid the judgment. The bureau must investigate the matter and if it is paid up, it will be removed. This is done at no cost to the consumer. It also means that you no longer need to make application to court to have a judgment rescinded."

Cobbledick cautions all consumers to be extremely vigilant and careful before agreeing to any loan or offer of credit. "These offers may seem like a lifeline but there are plenty of ways to earn extra money without getting into debt, especially considering the risks. Selling unwanted goods, applying for part-time and weekend jobs, advertising your skills can all be done for free on Gumtree. Obtain a copy of your credit report, contact the credit provider you are indebted to and devise a realistic payment plan. If you do choose to obtain a loan, do so safely."

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