In other words, the Act mandated the banks to be sure that you could pay them back, unlike the sub prime lending banks in the US, which makes this South African legislation possibly unique in a world regulated by profit over people.
The Act also introduced into law debt counseling for already over-extended borrowers.
First National Bank spokesperson Xolisa Vapi put it this way: "The South African banking system has effectively been insulated from the global financial crisis mainly as a result of the prevailing exchange control regulations.”
"Having said that, the Act has had its benefits for us in that it has improved the way we look at a customer before granting credit.”
Someone has to take credit.
(Seen on the gravestones of famous Wall Street banks like Bear Stearns and Lehman Brothers, “Regulate Lending”.)
I have to admit that sounds better than ‘separate state and finance’, but always remember that someone has to regulate the regulators, hence the eventual necessity of separating state and finance as exemplified by the South African National Credit Act.(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
