Maintenance defaulters to be blacklisted by credit bureaus?

The draft regulations to stop reckless lending, published last week, do not only hold credit providers to task – they will also hold child maintenance defaulters accountable. Maintenance defaulters will now have their credit records impaired for the first time.

Maintenance defaults will now stay on a person's credit record for five years or until the court rescinds the default judgment, whichever occurs sooner. Maintenance payments will be included in all affordability assessments completed when applying for new loans, and clients are required to declare if they have any maintenance default judgments.

The Maintenance Act makes provision for blacklisting defaulters with the Credit Bureau. However, non-payment of child maintenance does not currently affect one's credit record. Child maintenance is a legally binding agreement to pay regularly and on time, and these new rules suggest that failure to do so should carry real consequences.

The Democratic Alliance is fully behind this new move by the DTI. Shadow Minister for Trade and Industry, the DA’s Geordin Hill Lewis, released a statement welcoming the draft regulations.

“For the last six weeks the DA has been working closely with government agencies, departments and the major credit bureaus to find a way to increase the pressure on parents to fulfil their financial responsibilities to their children… maintenance payments are a lifeline for single parent families struggling to make ends meet. It helps parents to cover the basic necessities that all children need – food, clothes, school fees, after school care, medicine…” says Hill Lewis.

The public has until 31 August 2014 to comment on the draft regulations, after which, if passed, the regulations are legally binding, “making the application of affordability assessments compulsory,” says Ntuli.

Enquiries about the regulations can be submitted to the DTI’s Spokesperson, Sidwell Medupe: 012 394 1650 / 079 492 1774 / MSMedupe@thedti.gov.za

See here to view the Draft Affordability Assessment Regulations and to comment.