SACP STATEMENT ON SEIZURE OF SASSA CARDS BY NCR AND THE CONINUED RECKLESS LENDING

The SACP has noted the announcement by the National Credit Regulator of a raid in the Northern Cape which has resulted in close to 5000 SASSA cards being confiscated from micro lenders who were illegally holding them.

The SACP wishes to congratulate the NCR for the successful raid.

Over a period of time the SACP has been extremely worried about the growth of unsecured lending which goes against the main thrust of our campaign and the prescripts of the National Credit Act. We are aware that an investigation is currently underway, carried out by the National Credit Regulator, into the activities of both Capitec and African bank.

These two have maximized their profits by playing into the unsecured lending space. The SACP abhors their business model. We are of the view that the big four banks themselves are not innocent as far as reckless lending is concerned. We call on the NCR to speed up investigations against the micro lenders and the entire banking industry. We will not allow our economy to be dragged into an abyss by the greediness of the financial sector.

This report by the NCR and the latest expose on SABC 3 about debt securitization points to serious issues to be attended to in the financial sector.

The role of the Reserve Bank has been a sore point for us. The bank's continued assurances that there is no crisis amount to complicity in this unsecured lending scandal. It is worrying that whilst millions of our people are drowning in debt the Reserve Bank has chosen a path to create a façade of all is well simply because they want to rescue a financial sector that is not only in a crisis but acts immorally and feeds on the vulnerable poor.

We call on the Reserve Bank to show that it cares about our people and not the pockets of the financial oligarchies and to act in the interest of the majority to stop this reckless lending.

The SACP urges that all micro-lenders and banking officials involved in this must be charged criminally.

Statement issued by the SACP, June 12 2013

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