Debt counselling is a debt relief mechanism brought about through Section 86 of the National Credit Act. It is intended to reduce contractual debt instalments to affordable levels by extending term or reducing interest rates. This is either agreed to by credit providers or prescribed by the Magistrate and enforced through an order of Court.

Unfortunately the Act never prescribed the fees charged by debt counsellors or the deliverables upon which fees could be charged. These were the same missing stipulations that allowed administrators to make use of administration orders to over charge ignorant consumers.

Therefore make sure you agree all your upfront fees with the debt counsellor, ensuring no variable fees can be added, and that fees will only be charged once an order from Court has been received.