POLICY PROPOSAL
BRIAN KANTOR: Scrapping the credit act would change the lives of millions
Repeal would allow lenders and borrowers the freedom to contract with each other for credit on any terms they found agreeable
I have a very radical policy proposal: repeal the National Credit Act. Repeal would allow lenders and borrowers the freedom to contract with each other for credit on any terms they found agreeable. It would help transform the economic prospects of those many South Africans who do not benefit from regular incomes and so do not qualify for credit. Much freer access to credit would be particularly helpful to informal traders and aspirant entrepreneurs and farmers. Saving the significant costs of complying with regulations, a repeal might lead to less expensive borrowing terms for the many who receive credit. Strong competition for potential credit business would convert lower compliance costs of providing credit into lower charges for all borrowers. The reputation of the lenders for fair treatment of customers would become even more critical in attracting new and repeat business. The importance of maintaining reputation — brand value — in which so much is invested, including training e...
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