The priorities

Despite the excellent protections offered to consumers in Botswana there is still a long way to go.

I’ve no real complaints about the Consumer Protection Regulations, which are well written and comprehensive, but there are still some gaps, areas where consumers are left exposed.

Credit is probably my biggest concern.

Of course I’m not defending those consumers who borrow recklessly, signing up for as much as they possibly can because they want instant gratification but I do think there should be mechanisms that prevent them from actually getting those loans and hire purchase agreements. Although many people are skeptical of them that’s where credit reference agencies like TransUnion have a vital role to play. People often see them as an obstacle to getting credit but my view is different. They’re not an obstacle, they’re a protection. A protection not just for financial institutions, but also a protection for you and me.

They protect those of us who are regular payers, who do our best to pay off our debts because we are the ones who pay extra when bad payers default. We’re the ones who pick up their bills. They also protect reckless or desperate borrowers from getting into even deeper trouble.

That’s why it’s good news (even if you don’t believe me) that the credit bureaus are now considering sharing information amongst themselves to ensure that that protection is really thorough and comprehensive.

What’s really needed is a specific law that deals with lending and credit in general, a bit like the National Credit Act in South Africa. This is one of the few areas where we’re lagging behind our cousins down south.

My favourite part of the South African law is the bit that describes “reckless lending”. Before a credit provider can offer someone credit they are required to check if it’s really affordable. They’re obliged to look at the customer’s repayment history, their current financial status and to ensure that the customer fully understands what they’ll be getting into if they sign the agreement. Most importantly they are required to assess whether the new agreement will make the customer overly indebted.

And why should they do all this? What’s in it for the lender to go to all this trouble? It’s not just because it’s a legal requirement, it’s because if they fail to do so the customer can later go to court and have the entire agreement cancelled and the lender will be left to pick up the pieces.

That’s something I’d like to see in Botswana as well. The prospect of losing the entire deal might make some lenders behave a little bit more responsibly.

I’d also like to see much stronger protections against pyramid schemes. We’ve had our fair share of them in Botswana, starting with the so-called Success University, which was then take over by World Ventures, then there was TVI Express, then Pyxism. The only one of these to survive has been World Ventures but they’re on the way out having been declared an illegal pyramid scheme in at least one other country.

The same goes for Ponzi schemes, the most notable being Eurextrade. This was particularly curious because it was a scheme specifically targeted at Botswana and it was surprisingly successful, but only for the crooks running it. They made a lot of money from it but everyone in Botswana lost out massively. Some people lost millions to the scheme.

The problem is that there’s no specific law against either pyramid or Ponzi schemes in Botswana. The closest we get is the power the Bank of Botswana has to declare any scheme an “illegal deposit taking scheme”. In the past it’s taken Consumer Watchdog and some brave people at NBFIRA who have stood up to these frauds but we urgently need a specific law against these schemes so we can stop them and, if they’re operating in Botswana, prosecute them.

We also need some much stronger regulation of security companies. Yes, I mean the companies, not just their guards because it’s the companies that should be taking responsibility for their guard’s actions. We’ve all heard of guards who insist (illegally) on searching honest customers going about their lawful business, often because they’ve been told by their employers that they have the right to do so. But it gets worse. Much worse.

Anyone on Facebook will have seen a video that’s repeatedly posted that shows two security guards beating up an alleged shoplifter in a store in Gaborone. While nobody is saying shoplifters should be arrested it doesn’t mean the guards can use excessive force.

More recently we heard of a case where a customer in a restaurant in Gaborone witnessed an incident in which a “security guard manhandled and subsequently hit a woman so hard she fell hard on the floor”.

It later transpired that the woman in question had been seriously drunk and disruptive but does that excuse hitting her so hard that she fell to the floor? With the exception of two morons who suggested that she deserved a beating everyone who discussed the issue in our Facebook group was outraged by the guard’s behavior. Let remind ourselves that security guards are just civilians like you and me. They have no special powers and they most certainly are NOT police officers. They have no right to search you and your belongings and they most certainly can’t beat you up or hit you so hard to fall to the ground.

And this is before we confront the issue of a male guard hitting a woman.

These are just a few of the areas where I think we need greater control, stronger rights and some enforcement action from the organizations with the power to do so. What do you think?