Odds & Ends: What Falls within the Ambit of a ‘Credit Agreement under the NCA’ in SA

Posted on: October 16th, 2017 by Tholeka Ndabeni

All Creditors concluding agreements that qualify as credit agreements in terms of s8 of the National Credit Act must be registered as credit providers under the Act. Credit agreement includes credit facility as contemplated in s8(3) of the Act, a mortgage agreement or secured loan and any other agreement in terms of which payment of an amount owed by one person to another is deferred, and any charge, fee or interest is payable to the lender in respect of the agreement or deferred payment. Deferred payment usually involves instalment payments.

However, the Act does not apply to the following  credit agreements: agreements concluded between persons who are not at ‘arm’s length’; interest or fee free agreements; incidental agreements and agreements where the consumer is a juristic person with an annual turnover or asset value that equals or exceeds R1, 000, 000 or where the actual credit agreement exceeds R250,000.

Failure to register

In terms of S40 (4), where a credit agreement is entered into by a credit provider who is not registered as such, the agreement is rendered unlawful and void. Therefore the credit provider cannot rely on the agreement to claim his money back. The only remedy available to the unregistered credit provider is unjustified enrichment.[1]



[1] National Credit regulator v Opperman & others CC 2012

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