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Friday, November 27, 2015  
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Become debt free with a debt management plan from Killaghy Business Solutions

Objectives of the NCA

The objectives of the National Credit Act of South Africa are to:

  • Provide all South Africans with access to credit;
  • Protect consumers from reckless lending by credit providers;
  • Prevent creditors from taking reckless credit decisions;
  • Assist consumers who are in an over-indebted situation.

More on the debt counselling process and Debt Counsellors in Gauteng.


Duties of Debt Counsellors

Debt Counsellors in South Africa must:

  • Fully inform a client of the debt review procedure;
  • Clearly explain the costs involved;
  • Ensure that the client understands the consequences of debt review;
  • Ensure the client understands what is expected of him/her.

More on Killaghy Business Solutions, offering Debt Counselling in South Africa.


Duties of the Client

A client under debt review also has responsibilities:

  • While under debt review the client may not apply for further credit.
  • The client must comply with the instructions provided by the Debt Counsellor.
  • Should the client act outside of these instructions, his debt review may be terminated.
  • If a debt review is terminated all protection provided by the Act will be lost.

Becoming a Debt Counsellor

To become registered as a debt counsellor in South Africa:

  • You have to undergo a training programme through selected institutions.
  • The training programme ensures a thorough knowledge of both the Act and the Regulations pertaining thereto.
  • You must submit your CV and newly acquired qualification to the NCR for assessment.
  • The NCR assesses your suitability and ensures there are no conflicts of interest.

More on Killaghy Business Solutions, offering Debt Counselling in South Africa.


The National Credit Act of South Africa

In 2005 the South African Government decided that something needed to be done about debt provision and helping over-indebted consumers.  The National Credit Act was promulgated in 2005, passed into law in 2006 and implemented on the 1st June 2007. Many economic experts are of the opinion that the forward thinking of the National Credit RegulatorSouth African Government is one of the key reasons that the country largely escaped the economic crash that hit Europe and the USA in 2008. 

What does the National Credit Act of South Africa Cover?

What does the National Credit Act Govern?

  • Credit Transactions - The Act provides for the control and regulation of ALL credit transactions - mortgages, credit cards, overdrafts, micro loans, pawn broking and contract loans such as hire purchase of assets.
  • Credit Institutions - The Act also regulates ALL institutions that provide consumer credit including banks, furniture companies, clothing, other retailers, micro lenders and pawnbrokers.
  • Credit Information - The Act also regulates credit bureaux and consumer credit information, providing for free access to the information kept at the credit bureaux, and for a process by which any errors on the credit records of consumers can be corrected.
  • Debt Counsellors - In addition the Act makes provision for the registration of debt counsellors and debt restructuring for over-indebted consumers.

Bodies established By The NCA

The Act made provision for the establishment of the following bodies:

  1. The National Credit Regulator  (NCR) -  The NCR was established to carry out the educat3 bodies established by the National Credit Action, research, policy development and registration of industry participants, investigate complaints and ensure enforcement of the Act.
  2. The National Consumer Tribunal (NCT) - The NCT is an independent body and is tasked with hearing cases that arise from non-compliance with the Act, as well as the issuing of fines for contraventions thereof. Consumers and Credit Providers may appeal to the tribunal against decisions of the NCR.
  3. The Debt Counsellor (DC) - The DC is registered by the NCR only once training has been completed and exams passed. In addition the NCR completes an in-depth investigation of the prospective DC before he or she can be registered.

Debt Counsellors in South Africa

Debt Counselling in South Africa  is recognised as a profession and has established its own association  - the Debt Counsellors Association of South Africa ( DCASADebt Counsellors in South Africa) .The primary aim of the industry is to interview and assist over-indebted consumers and to ensure that the consumer is not the victim of unscrupulous or reckless lending. The professionalism of Debt Counselling in South Africa ensures that standards of right and honorable conduct must be observed by all Debt Counsellors in dealing with both the consumer and credit provider.

Debt Counselling in South Africa is monitored by the National Credit Regulator. All Debt Counsellors must submit a report every quarter, detailing all work carried out. The NCR may be contacted by any person that believes a Debt Counsellor is acting unprofessionally or unethically. If found guilty, the Debt Counsellor may be deregistered and legal proceedings enforced. This provides the consumer with protection from exploitation.

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