Trade Minister Parks Tau withdraws draft credit regulations following concerns over student debt

JOHANNESBURG -Trade and Industry Minister Parks Tau has withdrawn the draft regulations that would have potentially seen people with student debt blacklisted.

The department recently gazetted for public comment several draft amendments to the National Credit Act of 2005.

The withdrawal comes after Tau faced a public outcry over the amendments he said were set to strengthen consumer protections, how credit bureaus handle customer information and conduct affordability assessments.

The amendments would have opened up access for credit bureaus to have access to information held by state organs involved in fraud investigations and consumers’ criminal records.

Tau previously defended the move, saying the proposed changes are meant to ensure access to finance for Small, Medium, and Micro Enterprises (SMMEs) and not prejudice graduates who owe universities fees.

READ: National Credit Act: Concerns proposed changes could blacklist indebted students

He said the decision to withdraw the proposed amendments was informed by the overwhelming public response.

This includes more than 20,000 submissions received by the department before the closing date for public comments.

Most of the responses were opposed to the proposed regulations.

The minister said he will look into a process that will consider the changes that are required to protect students, while continuing with efforts aimed at improving access to finance for SMMEs in order to plug the credit funding gap that currently exists.