What roles both Credit Providers and Consumer play in preventing over-indebtedness

Credit Providers can play a crucial role in preventing over-indebtedness through responsible lending practices, transparent communication of loan terms, interest rates and repayment schedules to help the consumer make an informed decision.

Section 25(2) state that “A credit provider shall not enter into a credit agreement without first taking reasonable steps to assess- (a) the proposed consumer's-

(i) understanding and appreciation of the risks and costs of the proposed credit, and of the rights and obligations of a consumer under a credit agreement;

(ii) debt re-payment history as a consumer under credit agreements;

(iii) existing financial means and prospects; (iv) existing and future financial obligations...”

Consumers also have a role to play by ensuring proper financial planning, using credit wisely, understanding credit agreements, seeking financial advice and financial education to help them make informed choices.

Overcoming over-indebtedness is challenging but achievable with dedication and smart practices. By understanding your obligations, creating a repayment plan, cutting expenses, and negotiating with creditors, you can regain financial control and work toward a debt-free future.