Retailer Shoprite has been found guilty of reckless lending‚ the National Credit Regulator said on Wednesday.
The ruling was handed down by the National Consumer Tribunal after an investigation by the regulator.
“This judgment comes after an investigation by the National Credit Regulator (NCR) revealed Shoprite entered into credit agreements with consumers without conducting a reasonable and objective assessment of the consumers’ ability to afford the loans‚” said NCR chief executive Nomsa Motshegare.
“Some of the conduct of Shoprite that was found to be in contravention of the National Credit Act (NCA) was that Shoprite‚ when assessing whether a consumer could afford a loan or not‚ took into account unverified income of another person‚ such as a spouse or a life partner.”
The tribunal has imposed a fine of R1 million against Shoprite‚ and ordered the company to appoint a debt counsellor at its own costs to assess if the consumers mentioned in the referral are overly indebted.
“The NCR believes that this judgment by the Tribunal reaffirms the undesirability of reckless lending in our society‚” Motshegare said.
Source: TMG Digital.