Calls for consumer focus at G20

2010-10-23 10:39

Consumer groups want the protection of consumers in the financial services ­sector to form part of global economic discussions.

This week, the National Consumer Forum (NCF) wrote a letter to President Jacob Zuma, lobbying ­government’s ­support to establish a task team to look at ­financial consumer protection at the G20 summit scheduled to take place in South Korea next month.

NCF chairperson Thami Bolani said this campaign was initiated by ­Consumers International (CI) and would see consumer organisations across the world calling for G20 support.

CI is a federation of international ­consumer groups which serves to ­protect consumers with an ­independent, global voice. It claims to have 250 ­member organisations in 115 countries.

Bolani said this initiative came about in the wake of the global financial crisis and the state of consumer protection, ­especially in Africa.

“Consumer protection in Africa is in a shambles. South Africa is the only country with comprehensive consumer protection in financial services. There is no African country that has laws such as the National Credit Act and the ­Consumer Protection Act.

“Being the only African state represented in the G20, we are requesting President Zuma to support the formation of a G20 experts group on consumer financial protection,” Bolani said.

He said the aim of the task team would be to develop an international ­framework to help countries draw up their own financial consumer protection regimes.

CI head for Africa, Robert Michel, said many ­consumers lost their savings in the global financial crisis.

He said: “Banks and the financial ­services ­sector have received support from ­governments but nothing concrete was done for the ordinary consumer. ­Consumers, especially in Africa, are in need of protection.”

Michel said the CI has sent similar ­letters to the presidents of Ethiopia and Malawi, the two other African states that were invited to the G20 ­summit.

Finance Minister Pravin Gordhan said the challenge for the G20 was to iron out a global agenda that would put global ­interest above the national interests of ­individual nations.

“Crucial to this is how as we position ourselves as South Africa and how we would make the economy competitive from the consumer protection and ­business strategy perspectives,” he said.

Banking Association of SA managing director Cas Coovadia said efforts to protect consumers from unfair banking practices should be more ­country ­specific. He said local financial services consumers were well protected.

Coovadia said the banking industry had developed a voluntary code of good ­practice and established the ombudsman for banking services to oversee ­matters related to consumer protection.

Market conduct and consumer ­education deputy executive at the ­Financial Services Board (FSB), Gerry ­Anderson, said the regulator administered 13 pieces of legislation regarding ­non-banking financial services in the ­interest of the consumer.

“As circumstances change, however, regulators such as the FSB must stay abreast of developments in South Africa and internationally that may affect ­consumers, and accordingly amend ­legislation for which the regulator is ­responsible,” he said.

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