Africa-Press – Namibia. MEMBERS of the public have been warned that for every unsuccessful debit order against their bank accounts, they risk incurring charges equal to 1,5 % of the debit order amount, with a minimum of N$39 and a maximum of N$200.
This warning comes from the Bankers Association of Namibia (BAN), which has embarked on a campaign to educate the public on financial literacy to help them better manage their finances.
According to the association’s chief executive officer, Brian Katjaerua, these charges are in line with Bank of Namibia regulations. BAN launched the campaign because many life decisions revolve around managing finances, and this can be overwhelming, he said in a statement.
“So often we delay making the perfect decisions, and in other circumstances we don’t always understand the full functionality of products, services and financial instruments, such as debit orders,” Katjaerua said.
“A debit order is an agreement between you, the bank’s client, and a third party, to take an agreed sum of money from your bank account every month to pay mortgage loans, personal loans, car loans, insurance premiums, furniture accounts, clothing accounts and student loans.
“Debit orders enable people to pay their accounts on time, keep track of all payments, and stick to their budget,” Katjaerua said.
“As a consumer of financial products, it is your duty to make sure you understand the functionality of debit order agreements. Misunderstandings over debit order fees and deductions sometimes stem from a lack of understanding of what the agreement entails,” he said, adding that the first step for authorising a debit order is signing an agreement with the third party, and giving them your banking details.
He said the third party would then ask your bank to collect the agreed amount from your account, and only that party can cancel the debit order. If a bank account does not have sufficient funds to pay the agreed amount, debit order rejection fees apply, and late payment fees and interest are added by the third party.
Rejected debit orders will have a negative impact and affect one’s credit score in future. Clients must ensure debts payable through debit orders are settled before spending on their wants, Katjaerua said. Debit orders will be presented for collection against the client’s account three times during the day, he said.
In the event of unsuccessful debit orders, collectors may then choose to activate credit tracking, which is the continuous checking of funds in the client’s account if the debit order amount could not be deducted. Credit tracking can be done continuously for up to 14 days. Fees are not charged for credit tracking.
“Managing your debit orders is one of the most important tools to building a healthy credit profile, and being a financially literate banking consumer allows you to manage your finances with more confidence,” Katjaerua said and advised the public to visit: https://ban.na for more information.
