Your Rights as a Borrower Under the National Credit Act
South Africa's National Credit Act (NCA) sets the rules for how credit is offered, priced and collected. One of its main purposes is to protect consumers. Knowing your rights helps you spot a lender that is not playing by the rules and gives you confidence when you deal with one that is. This article is a general overview, not legal advice; for advice on your own situation, speak to a qualified professional or the National Credit Regulator.
Who the National Credit Act applies to
The NCA applies to most credit agreements in South Africa, including personal loans, short-term loans, credit cards, store cards and overdrafts. Credit providers above a certain size must register with the National Credit Regulator (NCR), the body that oversees the Act. Registered lenders have a registration number that you can check. You will find ours on our privacy page.
Your key rights
The right to apply for credit fairly
You have the right to apply for credit, and a lender may not unfairly discriminate against you when it considers your application. A lender may still decline an application, for example if you cannot afford the repayment, and you can ask for the reasons.
The right to clear information
You are entitled to information in plain and understandable language. Before you sign, you should receive a quote or pre-agreement statement that sets out the costs of the credit. Our guide on how to read a loan quote explains what to look for.
Protection against reckless lending
A lender must assess whether you can afford a loan before granting it. Giving credit to someone who clearly cannot afford it is known as reckless lending, and the NCA treats it seriously. This is why lenders ask for your proof of income and about your expenses; see what documents you need to apply.
Limits on interest and fees
The NCA and its regulations set maximum interest rates and fees for different types of credit. A registered lender may not charge more than these limits, and it may not add charges that are not allowed by the Act.
The right to a copy of your agreement
You are entitled to a copy of your credit agreement. Keep it safe: it is the record of what you agreed to and what you will pay.
Rights about your credit record
You have the right to access the information that credit bureaus hold about you, and you can obtain your credit report free of charge once a year from each credit bureau. If you find information that is wrong, you can dispute it with the bureau. Our post on improving your credit score explains why it pays to check your report regularly.
The right to settle early
You can generally settle a credit agreement early. Ask your lender for a settlement amount; paying off early can reduce the total cost of the loan.
Help if you become over-indebted
If you can no longer keep up with your debt repayments, the NCA provides for debt counselling, also called debt review, through registered debt counsellors. Our guide on what to do if you are struggling with debt explains your options.
Information about your account
During the life of your agreement you are entitled to statements or information about your account, such as the balance, payments received and charges. If you are unsure about an amount on your account, ask your lender to explain it.
Your responsibilities as a borrower
Rights come with responsibilities. When you apply for credit, you are expected to:
- Answer the lender's questions fully and truthfully
- Disclose your income and existing debt accurately
- Read the agreement before you sign it
- Make repayments on time, or contact the lender early if you cannot
Giving incorrect information on an application can count against you if a problem arises later, so be honest about your situation.
How to check that a lender is registered
Before you share your documents or sign anything:
- Ask the lender for its NCR registration number
- Check the number on the National Credit Regulator's website
- Make sure the name on the registration matches the company you are dealing with
If a lender cannot or will not give you a registration number, do not continue. Read our guide to spotting loan scams for other warning signs.
Where to go for help
If you think a lender has not followed the law, start by raising the issue with the lender in writing. If it is not resolved, you can approach the National Credit Regulator or the relevant ombud. Keep copies of your agreement, statements and any correspondence.
The bottom line
The National Credit Act exists to make credit fair and transparent. Knowing your rights lets you ask the right questions and choose a lender you can trust. To learn more about who we are and how we lend, visit our about page, or contact us with any questions about our loans.
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