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QUESTION: I would like to know why the balances showed by the debt counsellor and my creditors as outstanding debt are not the same?
ANSWER: Information gathered from Charles Shonayi, a registered debt counsellor employed by Debt Sage in Randburg, as well as websites on Payment Distribution Agency (PDA) statements, indicates that balances on PDA statements accessed by consumers are estimates.
Charles Shonayi says account information that the debt counsellor (DC) captures on the PDA system has to be correct. Otherwise, the balances would differ.
Furthermore, the balances differ because payments are processed by the PDA and the credit providers at different times. Credit providers apply payments to your account a few days after payments are made from the PDA and this affects the interest calculated on the account resulting in differences in the outstanding balance.
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It is possible that the credit providers may also be adding charges that the PDA are not aware of and that may need to be manually added or removed. Therefore, the balances on PDA statements should be taken as estimates. The debt counsellor has to call the credit provider to get the latest balances and update the system balances regularly.
It is normal to sometimes have up to three months’ payment differences, according to the editor of Debtfree Magazine on the website www.debtfreedigi.co.za.
It should be noted that the DC does not pay the credit providers. The DC uses a PDA (such as Hyphen or DC Partner) to split the installment (agreed on and paid by the consumer) among the various credit providers. DCs and PDAs also get fees out of payments you make via the PDA, as they should. The PDA statement shows how this distribution between the various stakeholders was done.