The following was obtained from The Banking Association - South Africa (

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Understanding the National Credit Act (NCA)

New legislation always introduces some uncertainty because people are not always sure who it applies to, what is covered, what has changed and so on.

We compiled the 10 most important facts you, as a consumer in South Africa, should know about the NCA.

What is the objective of the NCA?

The most important objectives of the NCA are to level the playing fields amongst all credit providers with regard to the manner in which credit is granted, how consumers are treated when applying for credit and during the relationship with the credit provider and to limit over-indebtedness by placing a responsibility on credit providers to ensure that they do not grant credit recklessly.

What is covered by the NCA?

The NCA applies to credit agreements entered into after 1 June 2007 between a consumer and a credit provider – banks, micro-lenders, furniture stores, clothing stores, appliance stores, vehicle financiers, etc.

Credit agreements include:

  • Credit cards
  • Mortgage loans
  • Installment agreements
  • Financial lease agreements on movable assets
  • Overdraft facilities on cheque accounts

Who are included in the scope of the NCA?

All natural persons, in other words individuals, fall within the scope of the NCA. Certain juristic persons are also included – like companies, Close Corporations, Trusts (with more than three trustees), partnerships, with a turnover or asset value less than R1million.

What has changed in the credit granting process?

Every credit provider will still follow its own unique credit granting process, but there are certain legal requirements which all registered credit providers must follow.

These requirements include:

  • Doing a full assessment of the applicant's credit and debt repayment history
  • Doing an affordability assessment to see if the applicant will be able to afford the credit being applied for
  • Providing the applicant with a quotation and pre-agreement (see below)
  • Determining if the applicant understands and appreciates the rights and obligations of the credit agreement.

Which documents must an applicant get?

Once a credit assessment has been done, and the credit provider is comfortable to grant credit to the applicant, the applicant must receive a quotation and pre- agreement from the credit provider.

The format and contents of these documents are prescribed by the NCA and the purpose of these two documents is to provide the applicant with all the costs, charges, terms and conditions upfront so that the applicant can make an informed decision about the credit.   The quotation is valid for 5 business days, so the applicant may "shop around" within this period for the best credit offer.

What is debt counselling?

The NCA allows for debt counsellors to be registered and to assist consumers who are over-indebted, or who fear they may be over-indebted. The debt counsellor will assess the consumer's financial position and will liaise with the credit providers, or make a recommendation that the consumer is over-indebted.

Whilst a consumer is under debt review, s/he may not apply for credit. For more information, visit the National Credit Regulator website at

What about consumer rights?

The NCA lists a number of consumer rights, which are protected by the Act – that means that if a protected consumer right is breached, the party who breached it is committing an offence in terms of the Act.

The following are protected consumer rights in the NCA:

  • The right to apply for credit
  • The right to protection against discrimination in respect of credit
  • The right to reasons for credit being refused
  • The right to receive documentation relating to the credit agreement
  • The right to receive documentation in plain and understandable language
  • The right to challenge records on the credit bureaux and to be compensated if the information is incorrect
  • The right to receive documentation in certain languages
  • The right to confidentiality

How does the "credit bureau amnesty" work?

Section 73 of the NCA makes it possible for certain information to be removed from the credit bureaux by 1 June 2007.

Adverse credit information listed on the credit bureaux by 01 September 2006 for debts less than R500 will be removed from the credit bureaux.

Accounts which were dormant for longer than 24 months by 01 September 2006, unless any enforcement action has been taken by the credit provider. This means that if a consumer has not paid an outstanding debt for a period of 24 months by 01 September 2006, and the credit provider has not handed the account over to attorneys (or other party) for collection or to take a judgment, then all the information relating to this account will be removed by 01 June 2007.

Judgment information that credit  bureaux receive from  the  courts will be removed from the credit bureaux in the following circumstances.

All judgment information in respect of a debt of up to R500 that was listed on the credit bureaux by 01 September 2006 – unless the consumer has more than two unpaid judgments on his/her credit record. This means that the judgment information will be removed from the credit bureau, and it is not a pre-requisite that the debt must have been paid;

In respect of a debt of up to R5000, if the judgment is older than 18 months by 01 September 2006 – unless the consumer has more than two unpaid judgments on his/her credit record. Again there is no pre-requisite for the debt to be paid in full for the information to be removed from the credit bureaux, i.e. the information should have been older than 18 months by 01 September 2006 and it will automatically be removed from the credit bureaux without application by the consumer.

It is very important for consumers to understand that only the judgment information of the abovementioned categories will be removed from the credit bureaux and that consumers still have an obligation to repay the outstanding debt to the credit grantor as the credit grantor can still exercise his/her rights for example to repossess furniture or to garnish the consumer’s salary.

In respect of a debt of up to R50 000, if the full amount was paid in full by the 1st September 2006.

In respect of a debt of up to R50 000 reflecting on the consumer’s credit record on 1st September 2006, if the full amount is paid by the consumer between 1st September 2006 and 1st September 2007.

For more information visit the Credit Information Ombud website at

Debt Counsellors

Marsia Kuypers

Tel: 082 396 2568

Fax: 086 556 3328

Area: Pretoria

Jan-Viljoen Coetzee

Tel: 084 549 1755

Fax: 086 621 9193

Area: Nina Park

Valerie Nakale

Tel: 018 381 8768

Fax: 018 381 8604

Area: Mafikeng

Dean Morris

Tel: 083 645 4094

Fax: 031 763 4363

Area: La Lucia

Joana Vivier

Tel: 053 832 6229

Fax: 086 543 4640

Area: Kimberley

Jacques Jooste

Tel: 011 794 7555

Fax: 011 794 9965

Area: Johannesburg

Marlene Stein

Tel: 012 667 4177

Fax: 086 527 2203

Area: Irene

Heidi Naude

Tel: 044 873 0281

Fax: 086 512 5012

Area: George

Herbert Theron

Tel: 011 472 0088

Fax: 086 655 6730

Area: Florida

Isabe Landman

Tel: 041 933 1189

Fax: 086 591 2676

Area: Despatch

Andiswa Tinto

Tel: 021 431 9134

Fax: 086 523 7084

Area: Cape Town

Jaco Janse Van Rensburg

Tel: 082 568 4969

Fax: 086 645 0389

Area: Barberton

Monique Snyders

Tel: 032 946 3024

Fax: 086 588 4605

Area: Ballito

Christopher Beukes

Tel: 084 2577599

Fax: 021 637 5023

Area: Athlone

Lydia Kinnear

Tel: 082 824 6338

Fax: 086 537 5976

Area: Annlin

Anlizette Schuurman

Tel: 031 903 3840

Fax: 031 701 5570

Area: Amanzimtoti

Kelebogile Mooketsi

Tel: 082 299 3430

Fax: 086 695 3280

Area: Amandasig

Annerie Marais

Tel: 083 703 0486

Fax: 045 838 6572

Area: Aliwall North

Rerandzo Mokgwatlheng

Tel: 082 430 6329

Fax: 011 805 8348

Area: Alexandra Township

Daniel Lezar

Tel: 011 907 1022

Fax: 011 907 1490

Area: Alberton