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Understanding debt and financial literacy

By Scelo Hlophe

The year 2018 came as a huge knockdown for a lot of South African consumers. The increase of VAT to 15% and the rapid increase of petrol has left consumers feeling the financial pinch. This has led to South African consumers finding themselves using their credit cards, personal loans and other credit facilities.

The average South African finds themselves paying plus minus 80% of their salary to debts. Leaving them with less to make it month to month. Bread and Milk can roughly cost you close to R50 alone so you can just imagine how much a month’s grocery can cost you with an average net of +/- R2000 left after having paid debts.

This leads to consumers going for extra credit to help them make it through the month, which leads to being over-indebted and affects your credit profile for future credit, employment, enrolling a child for school and applying for leasing through real estate agencies.

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In 2007, the Nation Credit Regulator (NCR) introduced a debt relief known as debt counselling/ debt review. This is where a consumer applies to go under Debt Review by consulting a registered Debt Counsellor (DC) who will go through all your debts, monthly expenses and income to determine how indebted you are. Debt counselling comes with pros and cons. The Cons are that,

  1. You will not be able to access credit as your profile will be flagged as under Debt Counselling with all the South African Credit Bureaus that are registered with the NCR. (Transunion, Compuscan, Experian, Clearscore just to mention a few)
  2. You will be liable to pay the debt counsellor fees over two months ( The first month will go towards paying the DC and the second month will go towards paying for Legal fees), you will be liable to pay an aftercare fee to your DC every month until you have finished paying.
  3. Once you have been declared indebted you can no longer be able to come out of the plan until you have finished paying off all of your debts or if you can prove that you can now be able to pay all of your debts and you are in a better financial state, through an attorney at your local Magistrate court.
  4. Due to the fact that your monthly repayments are reduced, your term of payment can be a bit stretched longer.

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READ: Money Mistakes Women Make in Relationships

The Debt Review plan is not really as bad as people are afraid it is, which is why it is important to not agree to anything over the phone or sign any documents without checking if the debt counsellor is registered with the NCR on the following link

The Pros that come with being under the plan are:

  1. You will be legally protected by your DC from your credit providers taking any legal action against you. These actions may include blacklisting, judgements, summons, garnishee orders and more. Provided that such has not been put under your name before you go under debt review.
  2. You will no longer need to make an arrangement or respond to your creditors’ letters, phone calls or threats as they will be communicating with your debt counsellor as your middleman.
  3. Your possessions (vehicle on finance, bond, furniture etc) are legally protected from being repossessed. Provided that a court order has not been sent to you to collect your assets before you register with a debt counsellor
  4. The DC’s plan can help you save money. The reason of going under the plan is to reduce your debt commitment to an amount that you can afford. This plan can help you get out of your financial mess while ensuring your ends meet.
  5. You will receive a monthly statement from a payment distribution agency (PDA) for you to see how your money is being split to your creditors.

Please note that the debt counsellor cannot take the payment directly from you. A PDA does the collection, distribution and statements. Before going under the plan, ensure to verify this information as a lot of consumers have found themselves being scammed of their monies.

The stats of young black people finding themselves under strenuous amount debt and going under debt counselling is shocking. Especially because of the lack of financial literacy and the inability to manage their finances the proper way. Young people need to be taught about saving and budgeting, which will help them avoid finding themselves being under financial stress.

Financial Literacy is a process that one needs to learn and keep as a lifestyle in order to be in a better financial standing. When applying for credit ensure you read the documents and inquire if you do not understand. Seek advice and calculate how the debt will affect you.

Written by: Zuko


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Privacy Policy


POPIA ActTo promote the protection of personal information processed by public and private bodies; to introduce certain conditions so as to establish minimum requirements for the processing of personal information; to provide for the establishment of an Information Regulator to exercise certain powers and to perform certain duties and functions in terms of this Act and the Promotion of Access to Information Act, 2000; to provide for the issuing of codes of conduct; to provide for the rights of persons regarding unsolicited electronic communications and automated decision making; to regulate the flow of personal information across the borders of the Republic; and to provide for matters connected therewith.


  • section 14 of the Constitution of the Republic of South Africa, 1996, provides that everyone has the right to privacy;
  • the right to privacy includes a right to protection against the unlawful collection, retention, dissemination and use of personal information;
  • the State must respect, protect, promote and fulfil the rights in the Bill of Rights;


  • consonant with the constitutional values of democracy and openness, the need for economic and social progress, within the framework of the information society, requires the removal of unnecessary impediments to the free flow of information, including personal information;


  • regulate, in harmony with international standards, the processing of personal information by public and private bodies in a manner that gives effect to the right to privacy subject to justifiable limitations that are aimed at protecting other rights and important interests,
  1. Definitions and Interpretation

1.1.“Personal Information” means information relating to an identifiable, living, natural person and where it is applicable, identifiable, existing juristic person, including all information as defined in the Protection of Personal Information Act 4 of 2013. 

1.2  Parliament assented to POPIA on 19 November 2013. The commencement date of section 1Part A of Chapter 5section 112 and section 113 was 11 April 2014. The commencement date of the other sections was 1 July 2020 (with the exception of section 110 and 114(4). The President of South Africa has proclaimed the POPI commencement date to be 1 July 2020.

1.3. “Processing” means the creation, generation, communication, storage, destruction of personal information as more fully defined in the Protection of Personal Information Act 4 of 2013.  

1.4. “You” or the “user” means any person who accesses and browses this website for any purpose. 

1.4. “Website” means the website of the KAYA 959 at URL or such other URL as KAYA 959 may choose from time to time.   

  1. Status and Amendments

2.1. KAYA 959 respects your privacy. This privacy policy statement sets out KAYA 959’s information gathering and dissemination practices in respect of the Website. 

2.2. This Privacy Policy governs the processing of personal information provided to KAYA 959 through your use of the Website. 

2.3. Please note that, due to legal and other developments, KAYA 959 may amend these terms and conditions from time to time.  

  1. Processing of Personal Information

3.1. By providing your personal information to KAYA 959 you acknowledge that it has been collected directly from you and consent to its processing by KAYA 959. 

3.2. Where you submit Personal Information (such as name, address, telephone number and email address) via the website (e.g. through completing any online form) the following principles are observed in the processing of that information: 

3.2.1. KAYA 959 will only collect personal information for a purpose consistent with the purpose for which it is required. The specific purpose for which information is 
collected will be apparent from the context in which it is requested. 

3.2.2. KAYA 959 will only process personal information in a manner that is adequate, relevant and not excessive in the context of the purpose for which it is processed. 

3.2.3. Personal information will only be processed for a purpose compatible with that for which it was collected, unless you have agreed to an alternative purpose in writing or KAYA 959 is permitted in terms of national legislation of general application dealing primarily with the protection of personal information. 

3.2.4. KAYA 959 will keep records of all personal Information collected and the specific purpose for which it was collected for a period of 1 (one) year from the date on which it was last used. 

3.2.5. KAYA 959 will not disclose any personal information relating to you to any third party unless your prior written agreement is obtained or KAYA 959 is required to do so by law. 

3.2.6. If personal information is released with your consent KAYA 959 will retain a record of the information released, the third party to which it was released, the reason for the release and the date of release, for a period of 1 (one) year from the date on which it was last used. 

3.2.7. KAYA 959 will destroy or delete any personal information that is no longer needed by KAYA 959 for the purpose it was initially collected, or subsequently processed. 

3.3. Note that, as permitted by the Electronic Communications and Transactions Act 25 of 2002, KAYA 959 may use personal information collected to compile profiles for statistical purposes. No information contained in the profiles or statistics will be able to be linked to any specific user.    

  1. Collection of anonymous data

4.1. KAYA 959 may use standard technology to collect information about the use of this website. This technology is not able to identify individual users but simply allows KAYA 959 to collect statistics. 

4.2. KAYA 959 may utilise temporary or session cookies to keep track of users’ browsing habits. A cookie is a small file that is placed on your hard drive in order to keep a record of your interaction with this website and facilitate user convenience. 

4.2.1. Cookies by themselves will not be used to identify users personally but may be used to compile identified statistics relating to use of services offered or to provide KAYA 959 with feedback on the performance of this website. 

4.2.2. The following classes of information may be collected in respect of users who have enabled cookies: The browser software used; IP address; Date and time of activities while visiting the website; URLs of internal pages visited; and referrers. 

4.3. If you do not wish cookies to be employed to customize your interaction with this website it is possible to alter the manner in which your browser handles cookies. Please note that, if this is done, certain services on this website may not be available. 

  1. Security

5.1. KAYA 959 takes reasonable measures to ensure the security and integrity of information submitted to or collected by this website, but cannot under any circumstances be held liable for any loss or other damage sustained by you as a result of unlawful access to or dissemination of any personal information by a third party. 

  1. Links to other websites

6.1. KAYA 959 has no control over and accepts no responsibility for the privacy practices of any third party websites to which hyperlinks may have been provided and KAYA 959 strongly recommends that you review the privacy policy of any website you visit before using it further. 

  1. Queries

7.1. If you have any queries about this privacy policy please contact us by emailing [email protected]