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JOHN DANIEL HOLDINGS LIMITED AND ITS SUBSIDIARIES
INTEGRATED ANNUAL REPORT 2011
JDH at a glance -
Continued
on the performance of the previous company which had
been trading for over nine years.
Viscacom (Pty) Ltd trading as JDH Credit Services
(Registration no. 2010/015744/07)
JDH Credit Services (JDHCS) is a credit provider supply-
ing financial and related instruments to the under banked
andmarginalised sectors of the South Africa economy and
potentially, other countries on the African continent. At
the financial year end the JDHCS product offerings com-
prised of micro-credit services.The JDHCS business model
seeks to reduce the risk associated with the provision of
credit to lower income classes by contractually securing
the recovery of the monthly repayments through the em-
ployer’s payroll infrastructure. JDHCS contracts with both
employer and employee to provide some security to the
loan. The process is as follows;
•
JDHCS identifies employers who wish to provide
loans to employees through a third party.
•
JDHCS and the employer enter into an agreement
whereby employer agrees to deduct the repayment
of the loan from the payroll run on behalf of the
employee and pay the same across to JDHCS
•
JDHCS then markets the service to the employees,
ensuring that the contract with the employees en-
titles the employer to make the payroll deduction.
•
The employer is paid an administration commission
for each deduction.
The benefits to the business model are mutual between
the three parties but a further significant benefit to
JDHCS is that the deduction occurs prior to the employee
receiving his/her disposable income. The difficulty most
creditors have with recovery is striking the account before
disbursement of the individuals income.
JDHCS applies sound lending criteria including the evalu-
ation of the employer as well as standard credit checking
of the individual. An affordability test is then performed
as per the NCA requirement but contrary to normal prac-
tice only 50% of the resulting value of the potential loan
amount is approved. In addition the employee must have
been employed by the employer for a period in excess of
six months and the employee enters into a debit order
agreement with JDHCS which kicks in immediately the
employee ceases to be an employee of the company.
The JDHCS Credit Committee has established policy
against which the granting of credit is administered and
regular audits are conducted to ensure compliance.
You gain strength, courage and confidence by
every experience in which you really stop to look
fear in the face...You must do the thing you think
you cannot do.
- Eleanor Roosevelt