The National Credit Regulator (NCR) is advising consumers where applicable to consider the option of their life credit life insurance benefit as a relief in this difficult period.

Nomsa Motshegare, the CEO, said a life credit life insurance that a consumer signed up when applying for a loan covers the outstanding debt in the event of unforeseen circumstances such as retrenchments, unemployment disability to earn income disabilities and others.

"In the event the consumer becomes unable to earn income, the life credit life insurance provides the credit providers must settle or pay the consumer's debt for a period of 12 months for the remaining payment period or until the consumer finds employment," said Motshegare. She said many consumers may not be aware that they have a credit life insurance and that premium is already included in the cost of credit.

"To check if this insurance is in place consumers must contact their credit providers and where applicable consider use of this benefit to provide relief."

Baney Sager, CEO of DebtBuster said as the government has considered ways to help consumers whose income might be affected by the lockdown, he said consumers should not bank on payment holidays.

"If you can continue to pay your debts, do so, because if you are told you qualify for leniency, the length of the payment holiday and the interest implications might mean that you have to pay back a bit more at the end of the loan term," he said. Sager said if the real problem is being overindebted the consumer should consider debt counselling.

He said a payment holiday is very good for someone who is facing short term cash cash crunch as a result of a lockdown, but it is possible that the interest will keep running even when payment is paused.

"This means that the total term loan may be more than the original total."

He said consumers should continue paying their debts and not assume that all lenders will offer a payment holiday.

"Whether a leniency life credit life insurance policy is in place or not, anyone who is struggling to make repayments should contact their lenders immediately and try to arrange and agree on a repayment plan."