November 2014

Be wary of misleading adverts and spend wisely during the festive season

With the end of the year approaching and the festive season gradually creeping in, the National Credit Regulator (NCR) is urging consumers to be vigilant when entering into credit agreements, said Mpho Ramapala, Acting Manager in the Education & Communication Department at the NCR.

Credit providers should disclose all costs in advertisements if they made reference to monthly instalments, repayment amount or any other cost of credit, she said. “Consumers should be wary of misleading terms in advertisements or direct solicitation for credit such as ‘no credit checks required’, ‘blacklisted consumers welcome’, ‘free credit’, ‘cheap credit’, ‘affordable credit’, ‘low cost credit’ or any wording that has substantially the same meaning”.

Ramapala also advised consumers not to leave their identity documents, bank cards / pins and SASSA cards with credit providers when applying for credit. “This is a criminal offence”, she stressed. Consumers should report cases where their bank / SASSA cards and identity documents were taken by credit providers to their local police stations.

Due to the year-end celebrations and excitement, the festive season provides the perfect opportunity to spend money that you do not have. “If you want to begin the New Year in a financially sound position, be aware of how you spend your money during this period and save for the New Year”, advised Ramapala.

Over the festive period, consumers should be especially wary of “buy now, pay after three months deals” and then incurring additional credit during those three months, cautioned Ramapala. “Consumers should request a pre-agreement statement and quotation when applying for credit. This will enable them to shop around and do a comparison.” 

The NCR urges consumers to seek loans with NCR-registered credit providers. They can identify such credit providers by a window decal (an orange sticker with an NCR logo) and a registration certificate that will also state the NCR credit provider registration number. 


To ensure that you are not put in a predicament of having to apply for credit come the New Year, spend wisely this year by following these simple steps: 

  • Do a budget for the festive season and include all debt, rent, electricity, water, insurance, transport, gifts, entertainment, etc;
  • When going shopping, have a shopping list to avoid buying unnecessary items;
  • If you didn’t budget for a holiday earlier in the year, it might be too late and risky in terms of finances to go on holiday this year;
  • Be proactive and double-up on your regular payments such as mortgage or rent, lights and water. That way you will be able to afford costs such as school fees and uniform which will hit you at the start of the New Year;
  • Prioritise your home loan and rent;
  • Shop around for cheaper options;
  • If you borrow money, make sure you borrow only for what is strictly necessary, and ensure that you can afford the repayments;
  • If you’re not sure of exactly how much you want to spend on each person’s present, it’s easy to get caught up in the moment and overspend. Limit yourself to an amount for each person to help keep track of your spending;
  • Items such as school stationery, uniforms or other useful items are a better investment. Choose presents that last long after Christmas;  
  • Instead of buying expensive presents, set up a savings fund and put away an amount for your loved ones each Christmas. Over time this will grow into a much bigger pot of money that can be used to fund school fees or pay off a car; 
  • Entertain at home. Ask guests to bring something for the meal so you share the costs of your festive entertainment; 
  • Each year, set up a separate fund for birthday and Christmas presents as well as holidays.  Keeping this money separate will enable you to save for special occasions, while at the same time fund your day-to-day living expenses without going into debt;
  • Use your bonus to reduce your debt burden by paying off existing loans. By spending wisely this year, you can reap the benefits next year; and  
  • Keep track of your spending by either jotting down or keeping the receipts of all your spending. 


Issued by:

Lebogang Selibi

National Credit Regulator

Tel: (011) 554 – 2722

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.


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