Paper short abstract:

Discussing South Africa’s National Credit Act (2007), the paper analyses the contradictory character of a society in which strong state intervention is required in order to keep it in alignment with a neoliberal-style market orientation

Paper long abstract:

Bank-, credit- and store-cards, as well as microloans both formal and illegal, have since 1994 been issued with abandon in South Africa. Seemingly oblivious of the complex interrelations which make debt inseparable from credit, the state passed the National Credit Act to restrict 'reckless lending'. It established various measures including arrangements for debt counselling, which proved problematic. Opportunistic and untrained individuals switched from their earlier roles as 'debt administrators' to set up small enterprises as 'debt counsellors'; some absconded with customers' money; those counselled often attended only a few sessions and later defaulted on their agreements. There was a lack of harmonisation between the provisions of the Act and those of earlier, apartheid-era legislation. And debt counsellors had insufficient clout, or financial muscle, to defend their clients in court in the case of non-agreement with their creditors.

This paper is based on a reading of the representations made to Parliament before the passing of the Act by various civil society bodies, notably the Black Sash (formerly a human rights organisation but now almost exclusively concerned with problems of indebtedness); on interviews with those responsible for setting up such services and arrangements and with a range of debt counsellors; and on case studies of indebted consumers who have sought help. It uses this ethnography to analyse the contradictory character of a society in which strong state intervention is required in order to keep it in alignment with a neoliberal-style market orientation.