Zimbabwe's natural person debt relief system : much-needed relief for no income no asset (NINA) debtors or 'out with the new'?

Abstract

Access to debt relief measures and a concomitant discharge of debts are some of the most fundamental elements of an effective natural person debt relief system. Failure to gain access to debt relief measures – due to, among others, stringent access requirements has plagued No Income No Asset (NINA) debtors in many jurisdictions worldwide. In response to this plight of NINA debtors, a remarkable trend in insolvency law has been witnessed which seeks to accommodate the needs of this widely excluded group of debtors. Zimbabwe is one of the countries which has responded positively to this trend by reforming its natural person debt relief system. This has seen the introduction of a consolidated Insolvency Act 7 of 2018. The Insolvency Act introduces the novel pre-liquidation and postliquidation compositions to the debt relief system. This paper examines the treatment of NINA debtors in the recently reformed natural person debt relief system of Zimbabwe. This examination has reviewed that the natural person debt relief system affords relief to over-committed debtors with excess income and/or disposable assets while ostracising NINA debtors. Additionally, this paper also juxtaposed Zimbabwe’s natural person debt relief system with internationally regarded principles and policies in insolvency law as outlined in the World Bank Report on the treatment of the insolvency natural persons and provided necessary recommendation for the reform of the prevailing debt relief measures.