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CALS and Black Sash welcome judgment protecting grant beneficiaries

- Black Sash and CALS

We welcome a recent judgment of the High Court which acknowledges the need to protect social grant beneficiaries offered bundled insurance product

Black Sash and CALS welcome the recent North Gauteng High Court judgment where the court upheld an appeal brought by the National Credit Regulator against Joshua Doore Group in a decision of the National Consumer Tribunal.  

The issue that was deliberated concerned whether the selling of bundled insurance to beneficiaries of Older Person's Grants or Disability Grants is reasonable within the meaning of the National Credit Act, where such beneficiaries derive no benefit from such insurance, nor can they claim from it. Black Sash intervened in the matter as a friend of the court represented by the Centre for Applied Legal Studies. 

We argue that this case raises important questions concerning the interpretation and application of sections of the National Credit Act regarding the sale of credit insurance to beneficiaries of Disability Grants and Older Person's Grants by Joshua Doore Group. It sells credit insurance to beneficiaries of Disability Grants and Older Person's Grants which includes cover for permanent or temporary disability, retrenchment and loss of employment. Beneficiaries of Disability Grants and Older Person's Grants accordingly have certain benefits included in the credit insurance that has no meaning for them and which they are unable to claim benefits on. 

The High Court’s decision reaffirms the constitutional imperative to consider the rights and dignity of social grant beneficiaries who receive guaranteed income from the State which they depend on as a lifeline emphasizing the need for it to be safeguarded and protected. 

This ruling found that the practice of requiring consumers who are social grant beneficiaries to become contractually bound to have deductions made from their grants for bundled insurance which does not apply and/or benefit them is exploitative and unconstitutional. 

For years, Black Sash, CALS and partners have raised concerns about the predatory lending practices of furniture retailers and micro-lenders, particularly their targeting of vulnerable individuals with little to no legal recourse. These practices often lead to entrenched cycles of debt and economic exclusion, undermining the constitutional rights to dignity, equality and access to basic needs. This judgment sends a clear message: economic exploitation under the guise of affordability cannot be tolerated. 

We commend the Court for reinforcing the principles of fair credit, informed consent and transparency, particularly for consumers who have historically been excluded from the formal financial system. The ruling aligns with our long-standing advocacy for stricter regulation of lending institutions and stronger enforcement of consumer protection legislation. 

As Black Sash marks 70 years of social justice advocacy this month, this judgment reaffirms the core values that have guided Black Sash since its founding: the protection of rights, the upholding of dignity and the advancement of justice for those most impacted by poverty and inequality. 

We urge the National Consumer Tribunal, the Department of Trade, Industry and Competition (DTIC) and the National Credit Regulator to take this judgment forward and ensure its enforcement across the retail and financial sectors. We also call for greater consumer education and stronger support for low-income households who continue to be disproportionately impacted by unscrupulous financial practices. This victory belongs not just to the applicants, but to social grant beneficiaries in particular fighting for economic dignity. 

Read the full judgment here. 

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