Introduction Of The National Credit Act

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The National Credit Act

• Replaces the Usury and Credit Agreements Acts
• Is consumer focused (initially entitled the Consumer Credit Bill)
• Increases the availability of credit and reduces the cost of credit
• Improves regulation of the credit environment (more inclusive)
• Creates transparent credit processed with a focus on client education and understanding
• Creates a healthier credit market through the introduction of reckless credit and over-indebtedness
• Improves the collection and recovery process
• Promulgated: 1 April 2006
• Effective date: 1 June 2007

Purpose Of The Act

The Act aims to promote a fair and non-discriminatory marketplace for access to consumer credit through...

• General regulation of consumer credit
  • Establish norms and standards relating to consumer credit
  • Regulate credit information
  • Promote responsible credit granting
    • Prohibit reckless credit granting
    • Provide for debt re-organisation in cases of over-indebtedness
  • Promote a consistent enforcement framework relating to consumer credit
  • Provide for registration of credit bureaus, credit providers and debt counselling services
• Improved standards of consumer information
  • Prevent certain unfair credit and credit marketing practices
• Promotion of black economic empowerment and ownership in the credit industry
• Establishing the National Credit Regulator and National Consumer Tribunal