NCA
National Credit Act
Promotes a fair, transparent, competitive, sustainable, responsible, efficient, and accessible credit market by regulating credit providers, credit bureaus, and debt counsellors, and prohibiting reckless lending.
Sections
3
Duties
3
Questions
4
Assessment from
R 35 000
What it covers
The National Credit Act 34 of 2005 (NCA) regulates the extension of credit in South Africa, replacing the older Usury Act and Credit Agreements Act regimes. It applies to virtually any credit agreement above the prescribed minimum threshold, including credit facilities, credit transactions (loans, instalment agreements, mortgages, leases), and credit guarantees. The NCA established the National Credit Regulator (NCR) to register and supervise credit providers, credit bureaus, and debt counsellors, and the National Consumer Tribunal to adjudicate disputes and impose penalties. Central pillars of the Act include: mandatory registration as a credit provider for any entity extending credit above the regulatory threshold or with more than 100 credit agreements outstanding; the prohibition on reckless lending under s81, requiring affordability assessment before granting credit; prescribed disclosure and pre-agreement quotation requirements; caps on interest rates, initiation fees, service fees, and credit life insurance premiums under the in duplum rule and National Credit Amendment Regulations; debt counselling and debt review processes for over-indebted consumers; and credit bureau regulation governing the accuracy and use of consumer credit information. The 2019 National Credit Amendment Act introduced debt intervention measures for low-income, over-indebted consumers. Non-compliance with the NCA can result in credit agreements being declared void or unenforceable, NCR investigation and penalties, and Consumer Tribunal orders including fines of up to 10% of annual turnover.
Does this apply to you?
It applies if
- Your organisation extends credit to consumers (loans, instalment sale agreements, credit facilities, mortgage agreements, leases of movable property)
- Your organisation has more than 100 credit agreements outstanding, or the total principal debt under all agreements exceeds the prescribed threshold, regardless of the number of agreements
- Your organisation provides credit guarantees on behalf of consumers
- Your organisation operates a store card, in-house credit facility, or 'buy now pay later' offering
- Your organisation is a credit bureau collecting, processing, or distributing consumer credit information
- Your organisation provides debt counselling services to over-indebted consumers
Thresholds that change what's required
- Registration as a credit provider is mandatory once the organisation has more than 100 credit agreements outstanding, or the total principal debt under agreements exceeds the threshold prescribed by the Minister (currently R500,000 in aggregate, subject to periodic review)
- Different categories of credit agreement (small, intermediate, large) attract different maximum interest rate caps and fee structures
Exemptions
- Credit agreements between juristic persons (companies) where the consumer is a juristic person with an asset value or turnover above the prescribed threshold are largely exempt from consumer protection provisions
- Certain credit agreements specifically excluded under NCA s4 (e.g. certain stokvels, certain employer-employee loan arrangements meeting specific criteria)
- The South African Reserve Bank and certain other specified public entities are excluded from registration requirements
What non-compliance costs
Maximum fine
R 1 000 000
Imprisonment
Imprisonment is not the primary enforcement mechanism under the NCA; enforcement is principally administrative and civil, through the National Consumer Tribunal
Civil exposure
The National Consumer Tribunal may declare credit agreements reckless and void in whole or part, order refunds of unlawfully charged fees or interest, and impose administrative fines of up to 10% of the credit provider's annual turnover or R1,000,000, whichever is greater
Reputational
NCR enforcement notices and Consumer Tribunal orders are published and reported in financial and consumer media; persistent reckless lending findings materially affect a credit provider's relationship with funders, rating agencies, and potential acquirers
What the assessment covers
The assessment works through 4 questions across 3 duties, scored out of 51. Each answer generates the specific actions needed to close or prove that duty — and a “yes” only counts once its evidence is in, which is what makes the score defensible rather than self-declared.
The questions themselves are part of the assessment.
Find out where you stand on NCA
Run the assessment, get your score, and get the exact list of what to fix — with the evidence trail an auditor will ask for.