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Be wary of credit repair scammers on the prowl

Article provided by Experian

As lockdown posed many restrictions, scammers have come up with innovative ways to deceive people, and we’ve seen an increase in some posing as ‘credit repair agents’.

Consumers should be careful of those claiming to improve credit scores and fix credit reports overnight, especially if charging an upfront fee. These scammers are often found on popular classifieds websites and social media, or even distributing flyers in your area or placing ads in local papers.

In South Africa, charging consumers an upfront fee to fix credit reports is illegal. It’s documented in schedule 1 of the Consumer Protection Act (CPA) and the National Credit Act (NCA).

Look out for these warning signs

Be suspicious of any agent or organisation that:

  • Insists that you pay for credit repair services before they have provided any services to you.
  • Does not explain the process and the role that they would play.
  • Advises against contacting a credit bureau directly.
  • Recommends you dispute your credit report information without having seen your credit information or verifying the validity of this data with your credit providers.
  • States they can improve your score and have information removed which a bureau will not remove.

You don’t need to pay anyone to change your credit report

All credit bureaus offer a free credit information dispute process. To dispute the information on your credit report, the first step is getting a copy of your report. South African credit bureaus are required to offer one free credit report a year to consumers. Some bureaus, such as Experian, offer unlimited free full credit reports.

Next, you should check what information is on your report. If there is any incorrect information, contact the bureaus directly to dispute that information. When contacting a bureau, you will need to supply the following documentation:

  • Copy of your ID document or passport if you’re a foreign national
  • Proof of address (not older than three months)
  • Any supporting documentation of the dispute (e.g. account, statement, settlement letter, etc.)

The credit bureaus will then investigate the dispute with the data provider; this investigation process can take up to 20 business days.

It’s important to note that even if a credit repair agent helps you fix your credit report, they would need to follow the same process, supply the same documentation, and take the same amount of time. There is no special process for credit repair agencies.

They cannot change your credit profile. Only a credit bureau can change your profile upon receiving confirmation from a data provider that the change should be made, or if the credit provider cannot provide evidence that the data on your report is accurate.

Also, a credit repair agency is not able to change your score at the credit bureau. Only you can do that by ensuring the data on your report is accurate and up to date (through logging a dispute) and improving the information on your report by using credit responsibly and paying your full instalments on time.

You can get a free credit report from Experian – go to My Credit Check.

To find out more about Experian Africa, visit www.experian.co.za

Experian is a proud Partner of the NSBC