NCR warns against signing unread documents

Wednesday, March 18, 2009

Potchefstroom - The National Credit Regulator (NCR) has urged consumers in the North West to avoid signing documents and contracts they have not read properly or do not understand.

Speaking during a Consumer Rights Workshop in Potchefstroom on Tuesday, the regulator's Education and Communications Senior Manager, Peter Setou said many consumers got themselves into serious debt because they did not understand or read the agreements they entered into with credit providers.

"We have learnt that most of the consumers who are in bad debt signed documents that they did not understand. Consumers must familiarize themselves with all contractual documents they are required to sign or ask someone who understands the contract to assist them," he said.

Mr Setou emphasised the need for all consumers to understand that their rights as a consumer were protected against tricky credit providers.

"We are living in times were information is very important in our lives as we enter into agreements almost every day of our lives. It is important that we read every piece of information on the document that we sign," he said.

Mr Setou highlighted that the majority of South Africans were increasingly dependent on loans and other forms of credit for starting a business, buying cars and homes and educating their children.

Since 2002, consumer spending on credit had grown from around R340 billion to more than R1 trillion in the country. Further to this, consumer credit market affects more than 17.5 million consumers in South Africa.

The workshop formed part of the celebrations of the World Consumer Rights Day which is celebrated annually on 15 March. The day is aimed at promoting the basic rights of all consumers and demanding that those rights be protected.

Ms Setou further warned against deals that seemed too good to be true. "In the past we have had credit providers offer the opportunity to buy house and then pay in off monthly. Consumers, after paying the agreed money, later realize that hidden in the contract it states they need to pay a further amount."

Warren Meyers, 23 an employee of the South African Defence Force in Potchefstroom said the workshop had been an eye-opener.

"I buy a lot of things on credit and the information about the rights that we have as consumers was news to me. I now know what to do before signing a contract for cars, houses and many other important things which can affect my finances," he said.