Real Estate Investor Magazine South Africa June 2013 | Page 18

COVER STORY
Act (NCA)? The National Credit Regulator’s
( NCR) i nve st ig at ions have u ncovered
signif icance evidence of reckless lending
by credit providers, to the extent that the
NCR has found unconstitutional the Credit
Industry Code of Conduct to Combat OverIndebtedness in terms of section 48(1) (b) of the
National Credit Act (NCA). “The mismatch
between sky-high debt and the credit industry
codes speaks to the credit providers’ lack of
enforcement of their code and the NCA.
The banks have refused to accept law such as
the in duplum rule, which prohibits interest
charges that exceed the amount of the principle
debt,” says Deborah Solomon a registered
debt counsellor and founder of The Debt
Counselling Industry portal, theDCI.co.za.
Debt counsellors around the country concur
that when the banks start to respect, apply and
abiding by the law, it would solve at least 80% of
all industry problems.
So a re we simply at the merc y of the
shak y house of ca rds that is the globa l
financial system? Are we to resign ourselves
to bear the brunt of the debt created by
governments, f inancia l instit utions and
uninformed individuals? Are we powerless
against governments that act unilaterally
and contrary to the will and the benef it of
the people, and f inancial institutions that
blatantly flout the law?
Absolutely not. In fact, the entire system
d e p e n d s o n t h e i g n o r a n c e a n d n o ninvolvement of the people – and that means
you and I. We hold the power in our hands, but
it is power that we have yet to exercise.
A “government” is appointed by the people
of the country collectively, voted into power
and then funded by the people. But through
ignorance and non-involvement, we give
government power w it hout demand ing
accountability. We allow government to act
unilaterally, to the detriment of the country
and all of our people. It is up to us, the citizens
of the country, to hold the government we have
voted into power accountable for its actions,
by being informed and involved. Only in a
country where the citizens are ignorant and
divided can the government can abuse the
authority given to it by the people.
Firstly, and most crucially, empower yourself
with knowledge. Understand the function
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June 2013 SA Real Estate Investor

of government, how it works and what the
consequences are of its actions. As most of us
are not legal experts, there are organisations
such as the Free Market Foundation and
the Law Review Project, as well as experts,
analysts and intellectuals in private companies
and political parties who raise red flags and
explain the implications of government’s
actions. If you cannot get involved actively, at
least contribute to the important work these
organisations do to prevent government from
taking advantage of our ignorance and our
non-involvement.
Secondly, realise the importance of your
vote. The people of this country hold the power
to decide who will be authorised to manage the
affairs of this country. Exercise this power by

the power, but – again – only if we act as one.
We need to stand together against financial
institutions that blatantly f lout the laws
created to protect us – their “valued” customers
– from their reckless lending behaviour, for
which we will ultimate bear the brunt. When
organisations such as theDCI.co.za, NewEra
and the Ubuntu Party take legal and civil
action to ensure the big banks abide by the
law, we – collectively - need to support them
in every way possible.
And as an individual, realise that you can
extract yourself from the bottomless pit of
debt and reclaim the power of your “promise
to pay”. Educate yourself to understand the
system and the laws that are in place to protect
us from unscrupulous financial institutions.

“We hold the power in our hands, but it is
power that we have yet to exercise”
voting, and by voting for the party you believe
is best qualified to act on behalf of all of us
collectively. Don’t u ndermine the power of
your vote by simply voting for the party your
friends vote for, or based on emotions roused
by passionate but meaningless campaigning.
Read the part y manifestos and do some
research to ensure that when you cast your
vote, it will be for the party best positioned to
run the affairs of this country, for the benefit
of all of us.
Thirdly, we need to keep government
accountable. We can only do this if we are
informed and act as one people. A divided
nation is weak, and a government can take
advantage of that. A united nation, standing
together as one to demand accountability and
responsibility from its government, for the good
of all its people, tips the balance of power back
to the people. And no attempt at dividing us
makes any sense any more: 20 years ago we, the
people of South Africa, collectively decided that
we would move forward into the future as one
Rainbow Nation. It doesn’t matter whether you
are black, white, male, female, young or old, we
– South Africans - all essentially want one and
the same thing: fair, equal opportunity to create
a better future for all our children.
Also, we are not powerless victims of the
financial institutions. As the consumers of
their financial products and credit, we hold

Know your rights and stand on them. Respect
the power of your “promise to pay” and honour
your “promises to pay”, because it underscores
the entire financial system.
The house of cards is shaky. But, if we become
informed and involved, we can responsibly and
intelligently react to the harsh reality that the
buck stops with us. Because the buck not only
stops with us in future when the house of cards
tumbles, the buck stops with us right now to
prevent it from happening. If we – collectively
- become a solid foundation, if our promises to
pay become valuable again, because we make
intelligent promises to pay and keep them,
if we understand the game and demand that
our government and our financial institutions
play the game responsibly, intelligently and
within the law, we can take back our power and
transform the financial system from within and
from its very foundation, for the greater good
of all of us.
*Don’t miss the next edition of Real
Estate Investor magazine in which we will
look at some practical ways in which you
can reclaim the power of your “promise
to pay”, and use it to contribute to a solid
foundation for a financial system based
on responsible lending and accountable
government.

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