Adv Randolph Samuel @ Lucid Living™
The National Credit Regulator (NCR) announced that it had received an unprecedented number of debt counselling applications in the first two days of February 2010.
According to official figures released by the NCR, 1,429 individuals had entered debt counselling for assistance, to relieve their debt burden. This takes the total number of applicants, in debt counsellingto 145,027.
The steep increase can be attributed to a few factors –
- In 2009 the economy shed close to 1 million jobs. The full impact of this, is now working its way through the financial system. The retrenchment payouts and savings are drying up and people are finding themselves in financial dire straits;
- Through 2009 creditors were encouraging their clients to engage with them to arrange reduced monthly instalments. However, with the job market stagnant and the economic recovery slow, the reprieve did not last long. Consumers are finding it increasingly difficult to service their debt, even where voluntary arrangements have resulted in the monthly instalment being reduced;
- In response to failed strategies to stem the rising bad debt tide, creditors are resorting to firmer, traditional collections methods. According to the NCR during the third quarter of 2009, 24.70 million enquiries were made (to credit bureaux) for debt collection purposes (this is a 110.6% year-on-year increase). With credit providers taking a more aggressive stance, consumers are quickly realizing that options are limited and debt counselling is an effective remedy;
- Debt counseling has received significant attention from the NCR and various industry stakeholders in recent months, with a view to improving efficiencies and standards. This exposure has greatly improved the industry’s service levels and increased the public awareness of the process. People are less skeptical of debt counselling- the rise in debt counselling cases is a testament to this; and
- The consumer’s attitudes and perceptions of debt counselling is transforming. Consumers recognize that they are not alone – there are millions of people in a similar financial quagmire. The negative stigma associated with financial distress is less burdensome and shameful. People recognize that they have to be proactive and take action to salvage their situation – the problem cannot be ignored.
Thousands of consumers in financial distress come to realize each day, that debt counselling is one of the few viable alternatives available to them. It is an extremely powerful legal right and if harnessed correctly, could mean the difference between financial disaster and financial salvation. Debt counselling allows you to maintain an acceptable standard of living, keep your home, car and other hard earned possessions, while being accountable for servicing your debt in a responsible manner. There should be no embarrassment or shame on your part, millions of consumers world-wide find them selves in a similar situation – in most instances, not of their own doing, but because of irresponsible and reckless corporations.
Be responsible and take ownership of your financial problems. You alone control your financial destiny. The situation you find yourself in today will change – whether it’s for the better or worst, depends on what you do today.