It’s been 27 days of lockdown in South Africa, and it would seem that this pandemic is leaving no one untouched. Not everyone has the virus, but it’s affecting each and every one of us in different ways. Everyone is taking some form of strain and have had to make some form of adjustment. What sets South Africa apart from the world, however, is that we were also hit with an official downgrade to junk status in the early stages of the pandemic which has sent the Rand and the economy into a freefall. Money is on everyone’s minds – low income, high income, no income.
South Africa’s major banks have introduced various measures to assist consumers who are impacted financially by the coronavirus and the 35-day lockdown. Most of the assistance comes in the form of three-month debt holidays on loans ranging from mortgages to credit card balances. Some consumers will automatically receive these payment holidays, while others have to apply to their banks.
All of the financial assistance, however, is subject to whether a consumer is in good standing with the bank and has kept up with monthly payments.
Individual customers who owe Absa money will be invited to take an up to three-month repayment holiday, regardless of the kind of loan or how much money those customers earn. There will also be an option to reduce repayments instead. Individual clients will automatically qualify for the relief, but business and corporate clients are encouraged to contact the bank for case-by-case arrangements on their debt.
Standard Bank is offering all of its personal banking customers, and business clients who earn less than R20 million a year, a three-month debt holiday until the end of June. Clients earning R7 500 or less and students will automatically receive the three-month holiday, while other banking clients can apply for the relief by contacting the bank.
First National Bank (FNB) will be offering debt repayment holidays of up to three months to its customers, but strict terms and conditions apply. Clients will need to contact the bank, and have a letter from their employer to show loss of income due to the novel coronavirus. Those who are self-employed would need to submit financial statements.
Nedbank is offering clients “individual solutions to cashflow challenges” due to the coronavirus, which includes halting debt repayments (or part thereof) for a “suitable” period. Alternatively, clients loan periods may be extended or they could get more credit to manage short term cashflow shortfalls. Clients are encouraged to contact Nedbank telephonically to enquire if they qualify for the assistance.
Capitec has not introduced any special initiatives to help consumers during the pandemic, but said it will instead be handling credit defaults on a case-by-case basis. Capitec urged clients who may be facing a crisis as a result of the coronavirus to not delay contacting the bank, the bank’s head of communications Charl Nel said.
WesBank is offering clients payment relief plans from the 1 April to the end of June. These include relief on financial services products such as its vehicle and asset financing, full maintenance leasing and vehicle stock funding. Clients can contact the bank to receive assistance.
It is crucial for consumers not to assume that banks have automatically granted them a payment holiday. Keep in touch with your bank, creditors and debt counsellors to avoid missing payments. Missing a payment affects your credit score and standing with the bank.
If you are currently under Dent Counselling, missing a payment means the process is cancelled, along with any legal protections provided under the National Credit Act.
If you are finding it difficult to keep up with your monthly payments, reach out to us at email@example.com. You can also complete our free online application form online and a debt counsellor will be in touch as soon as your paperwork has been received. We’re here to help!