According to the latest FinScope Consumer Survey, an estimated 98% of South African adults have access to formal financial services. This near-universal access is mostly attributed to the advancement of technology, product innovations within the financial services sector and the regulatory framework that allows for data sharing, which is competently facilitated and monitored by the South African Credit and Risk Reporting Association (SACRRA).
The sharing of consumer credit and risk data contributes to greater financial inclusion by increasing access to finance for individuals by providing credit information to facilitate faster and better credit and risk assessments.
“Accurate, timely, and comprehensive credit and risk data allows lenders and other financial services providers to assess creditworthiness and risk more fairly and extend credit responsibly in line with the requirements of the National Credit Act,” explains Magauta Mphahlele, Executive Director of SACRRA. “By ensuring all credit and relevant data providers report data transparently, we can support more inclusive lending practices.”
“This will ultimately increase access to affordable and responsible credit for all qualifying consumers, whilst at the same time supporting regulators to monitor trends and intervene more timeously where market conduct risks and consumer debt stress levels are picked up,” she continues.
SACRRA manages the Central Data Transmission Hub (DTH) through which consumer credit and risk data is shared to the six credit bureaus authorised by the National Credit Regulator to host and share consumer payment profile information under Regulation 19(13). More than 4.5 million daily consumer records, and 64 million monthly consumer accounts, from more than 4 000 credit and data providers are shared to the credit bureaus through the DTH.
“The DTH is a secure and encrypted mechanism that feeds each of the bureaus with the same data at exactly the same time, within the prescribed timeframes,” informs Mphahlele. “This allows the payment profile information of consumers to largely be the same across the bureaus, and as a result, irrespective which of the six bureaus a lender or financial services provider utilises, they will access the same payment profile information.”
“In view of the above, it is important that all registered credit providers and relevant data providers submit and update data timeously,” she says. “We still have some entities that do not comply in terms of submitting and updating data, and this unfortunately leads to inaccurate and outdated consumer payment profiles, which unfairly denies access to credit and other financial services for qualifying consumers.”
“The updating of data is also important to allow consumers who have rehabilitated themselves to re-enter the market,” continues Mphahlele. “For example, where a consumer has a court judgment or an adverse classification listed against their name and they settle that judgment or adverse account, the credit provider is required to update the credit bureau within seven business days of settlement.”
Mphahlele encourages consumers to regularly check their credit profiles. “Incorrect, outdated, prescribed and fraudulent information needs to be disputed directly with the credit bureaus as SACRRA does not hold the data. If their disputes are not resolved within 21 business days, consumers can escalate them to the National Financial Ombud Scheme.”
The requirements of Regulation 19(13)
Credit and data providers are required to report credit information to the credit bureaus in the following manner and timeframes:
- The details of all new credit agreements entered into with consumers within 48 hours of the credit agreements being concluded;
- The details of all closed, terminated, rescinded or settled credit agreements within 48 hours of the credit agreements being closed, terminated or settled;
- The monthly payment profile information of consumers within 5 (five) business days of the agreed billing cycle;
- Subject to the provisions of Regulation 19 (4) and Regulation 19 (7), the adverse classifications of consumer behaviour and adverse classifications of enforcement actions monthly;
- The settlement of all adverse information as set out in S71A (1) (a) to (c) of the Act within seven (7) days of settlement by the consumer of such adverse information; and
- The settlement of all judgment debts as set out in S71A (1)(d) of the Act within seven days of settlement by the consumer of such judgment debt, in such manner and form as may be prescribed by the National Credit Regulator.
In summary, SACRRA facilitates accurate credit and risk data reporting in South Africa by providing a strict data format, secure transmission, continuous quality oversight, and compliance mechanisms aligned with national credit regulations.
“SACRRA plays a pivotal role in preventing reckless lending and borrowing by ensuring the timeous and compliant updating of consumer profiles at the credit bureaus,” concludes Mphahlele.
More information on consumer data rights and responsibilities can be found here: https://sacrra.org.za/consumer/
