Windhoek: The Namibia Financial Institutions Supervisory Authority (Namfisa) has issued a warning to the public to use only registered entities for credit and financial services.

According to Namibia Press Agency - English, Namfisa stated that engaging with unregistered microlenders subjects service users to illegal practices, excessive charges, and loss of legal protection. The authority emphasized the importance of using registered microlenders when accessing short-term credit and financial services.

The statement highlighted that all microlenders must be registered and supervised to operate legally as prescribed by the Microlending Act of Namibia. This Act is crucial for consumer protection, ensuring that transparency, fairness, and accountability are maintained within the industry. Registered businesses are obligated to disclose all interest rates, fees, and repayment terms upfront and are prohibited from charging fees beyond legal limits or employing abusive practices.

Namfisa also reminded the public that it is illegal for any lender to retain a borrower's personal documents, bank cards, or PIN as security for a loan. Registered operators must provide consumers with comprehensive loan documentation for every transaction.

Namfisa spokesperson Victoria Raimond underscored the importance of consumer vigilance. She encouraged the public to remain informed and protect themselves from financial exploitation, stressing that responsible borrowing starts with choosing a registered and regulated microlender.

The regulator advised potential borrowers to verify the registration status of any microlender before entering into an agreement by consulting the up-to-date list of authorised entities available on the Namfisa website.