by Xolile Bhengu, The Times
When Doris Msibi, 55, borrowed R4 000 to pay for her daughter’s funeral, she didn’t realise she would be repaying a total of R11 509.55 — almost 90% interest.
But the loan was not from a loan shark. It was with one of South Africa’s top four banks —
Nedbank.
Msibi borrowed R4 000, but she was immediately charged an additional R1 000 in “administration fees”, which meant she now has to pay R320.17 a month for three years.
Msibi said: “I only qualified for R1000 from work. My burial society had buried two of my relatives before, and were unwilling to pay for my daughter’s funeral.”
The grieving mother was approached at her place of work,
Anglo Research, by a broker, who was only known to her as Sello, offering loan arrangements through
Nedbank.
Though she specifically asked for her loan to be paid back over 24 months, she later discovered her loan agreement was for three years.
Msibi, who has worked as a cleaner for 20 years, earns a gross salary of R1 800 a month. After deductions for clothing accounts and furniture, the Doornkop resident is left with about R800 to take care of two grandchildren and her son.
With only Grade 5 education, Msibi struggled to understand the loan agreement she had signed and turned to colleague Elaine Kgosana for help.
Kgosana approached
Nedbank’s Southdale branch and queried on Msibi’s behalf.
Kgosana said: “I was told she was a high-risk client and it was not unusual for people with her type of income to be charged such an astronomical interest rate, and that some people paid close to 90 percent interest.”
Msibi said she was willing to honour her loan payment but would like the interest to be lowered.
Nedbank personal loans strategic business communications manger Roshelle Pillay said: “We would like to confirm that ND Msibi took out a R4000 loan in September 2006, to be repaid over 36 months at an interest rate of 65.5percent.
“Under the Usury Act Exemption Notice and regulated by the Micro Finance Regulatory Council no maximum rates were set. The risk profile of the client influenced the rate at which the client repays the loan.”
But run a R4 000 three-year loan at 65.5 percent interest through a loan calculator, and the monthly repayments come to R256.14.
The R320.17 Msibi is being charged equates to a R5 000 three-year loan at 65.5 percent. Since she received R4 000, she is effectively being charged 89 percent interest.
Msbibi agreed to this loan in October, before the National Credit Act came into effect in June.
Nedbank said the new legislation sets a limit of 40.9 percent on unsecured loans at the current prime rate of 13 percent.
Nedbank is part of the Old Mutual group.
Update 10-July-2007: After
The Times ran the story, the bank shaved off R6,941.44 from the R11,509.55 Msibi would have had to pay at the end of her loan agreement. Now an anonymous donor, a 71-year-old woman from Cape Town, deposited a cheque for R4,568.11 into Msibi’s Nedbank account late last week after reading of her predicament in
The Times.
There are a few interesting myths and misconceptions out there about PCs and defragmentation. The first myth is that NTFS drives don't need to be defragmented. The second is that "modern" operating systems don't need to be defragmented at all. The third is that simple defragmentation on its own keeps your PC working fast.
The last one is the easiest to deal with. Recently I converted my brother's old Pentium II machine running WindowsXP into a "backup server". The WDD defrag program had been run occasionally, and the drive was pretty full, so most files were not too seriously fragmented.
As you can see from the "before" picture, the green files are all defragmented, but not particularly well organised. This was partly because I had just uninstalled a whole load of games and other junk from what was at one time a family PC.
Given the choice between the two drive layouts, which one do you think will work more efficiently? The answer is pretty obvious. It was easily demonstrated on the PC in question because of its low processing horsepower in the first place. By the time I had defragmented the drive, cleaned the registry with CCleaner, and then compressed it with NTREGOPT, the machine was starting to "run" instead of "walk".
Suddenly last week I started getting lots of responses to my "Great Defrag Shootout" series. Then my friend Ian, who subscribes to the "Gizmo" Support Alert Newsletter, send me a copy of issue number 
Parliament’s Standing Committee on Public Accounts (Scopa) has launched a probe into the awarding of a R408- million tender for the controversial eNatis project.