The growing level of credit extension in South Africa has received a lot of attention recently, more so as household debt, as a percentage of disposable income, tests record highs. It has been argued that this growth in household debt has been driven by ease of access to credit, with authorities going so far as to suggest that lenders have been extending credit ‘recklessly’. The National Credit Act was enacted on the premise that consumers need to be protected from this practice. The Act thus exerts pressure on the credit lenders to assess the consumer’s ability to repay, disclose the cost of credit, as well as setting limit on interest that can be charged. The aim of the research is to investigate the effectiveness of the Act in curbing consumer indebtedness and how it can lead to consumer behavioural attitudes and actions toward credit use. The research was carried out in two stages. The purpose of the first phase sought to explore the effectiveness of the Act by consulting with those charged with supervision of the Act (the regulator) and those implementing the Act (credit providers), while the second phase conducted a survey amongst consumers to establish their levels of awareness and understanding of the Act, and how they would model their behaviours differently, so as to curb their indebtedness. The results derived from the research show that an overwhelming acceptance of the Act, its intentions and desired outcomes amongst credit provider and the regulator, and the general need for consumer protection. Consumers, on the other hand indicate a low level of awareness of the Act, its intentions and how it is likely to impact on their finances, making it difficult to tell if it can lead to changes in levels of consumer indebtedness. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

Due to the ineffectiveness of previous credit consumer legislation to deal with the demands of a complex consumer market, a need for legislative reform in this area arose in South Africa. The National Credit Act was introduced to create a single system to regulate credit and to address the shortcomings of the previous consumer credit legislation. The Act came into full force and effect on 1 June 2007. it has a wider field of application that its predecessors and offer greater protection to consumers who enter into credit agreements with credit providers. The Act applies to all credit almost all credit agreements between parties dealing at arm's length and made, or having an effect within the Republic of South Africa, subject to certain exclusions. Three main categories of credit agreements can be identified in the Act. They are credit facilities, credit transactions and credit guarantees. The second main category also has sub-categories of agreements which are also defined in the Act. It is sometimes difficult to distinguish between the different credit agreements but it remains important since different rules apply in respect of each credit agreement. In order to distinguish a credit agreement from another, it is important to look at the elements of each definition closely and to identify characteristics which are unique to that specific agreement. It is widely accepted that every credit agreement contains two essential elements. Firstly there has to be a deferral of payment by the credit provider in respect of a debt owed by the consumer and secondly the credit provider charges a fee or interest in respect of the deferred payment. It is interesting in this regard that some of the definitions in the Act do not require a fee or interest to be levied such as in the case of a mortgage agreement or a secured loan. Coincidentally, these two definitions are also problematic in the sense that they introduce concepts which are not recognised in our legal system, it will be interesting to see what our courts make of these concepts and how they will go about incorporating it into the general principles of South African law. The different agreements to which the Act applies and their irregularities will be discussed and critically analysed. Copyright / Dissertation (LLM)--University of Pretoria, 2012. / Private Law / unrestricted

The credit industry in South Africa has grown exponentially over the past two decades. Previously the industry was regulated by different Acts that had to be interpreted jointly, and while there was an overlap between them they also differed. The dual implementation made consumer credit an extremely difficult and confusing environment, especially for the consumer. Global movement towards socio-economic type legislation and in an effort to bring a solution to the eminent credit crisis resulted in new consumer protection law. Enacted on 10 March 2006 and phased in stages over a 12 month period from 1 June 2006 till 1 June 2007 the National Credit Act has a wider field of application than any of its predecessors, bringing with it a single platform for consumer credit regulation. The management of the credit relationship between the credit provider and the consumer is largely by agreement or in other words contract. The National Credit Act to a considerable extent codifies this relationship. The NCA applies to every credit agreement between parties dealing at arm’s length and made within, or having an effect within, the Republic. This definition is subject to limitations and the exclusions. The way in which the NCA defines its field of application may differ from its predecessors and even common law. The Act defines three main types of credit agreements namely credit facilities, credit transactions and credit guarantees. Credit transactions also consist of eight subcategories. It is critical to distinguish between these different credit agreements and the manner in which the Act defines them must be scrutinised. This is not only important to determine if a certain agreement is a credit agreement in terms of the National Credit Act, but also if the Act applies, to what extent. Unfortunate grammatical construction and word choice by the legislator does not assist in this task. How the Act defines its field of application in relation to the types of agreement it applies to will be critically discussed and analysed. / Dissertation (LLM)--University of Pretoria, 2014. / Private Law / unrestricted

No abstract available / Dissertation (LLM)--University of Pretoria, 2013. / lmchunu2014 / Mercantile Law / unrestricted

This dissertation investigates, in general, the debt enforcement procedures contained in the National Credit Act. It provides information on the purpose of consumer credit legislation and the South African credit industry to indicate the necessity for proper regulation. It further identifies some areas that had been problematic in the debt enforcement process, but which were clarified by recent court decisions. Specific aspects related to current problems experienced in the interpretation of the Act with reference to debt enforcement are identified, and the opinions of various authors, as well as the researcher’s own opinion, are provided in order to find solutions to such problems. It is clear from the provisions of section 3 of the Act and the discussions throughout this dissertation that the legislature regarded the protection of the consumers as its first priority. A delicate balance must, however, be maintained to protect the consumers interests, and those of the credit provider, since it would inevitably influence the South African economy if the balance were to favour a particular party’s interests. Recent decisions by the courts indicate that the Act is not all-inclusive and that the common law will be used to provide guidance or to take precedence where the Act does not make provision for certain circumstances or debt enforcement procedures. This dissertation further illustrates that the legislature needs to refine the provisions of debt enforcement contained in the Act, to clear ambiguities and create legal certainty. For as long as there are ambiguities in the Act, both the consumer and the credit provider will be disadvantaged, since in that case, a balance between the rights and the obligations of the consumer and those of the credit provider does not exist. Despite the fact that these ambiguities will eventually be clarified by interpretations provided by the courts, the Act, currently fails in its purpose to a certain extent, since clear and precise legislation is required. However, expensive and time-consuming interpretations are now required from the courts to resolve practical problems and to clear ambiguities. / Dissertation (LLM)--University of Pretoria, 2013. / Private Law / unrestricted

M.Com. (Business Management) / The aim of this research study is to investigate the effect of the National Credit Act on a micro-lending financial institution, namely Old Mutual Finance. The objective of the study is to gain insight from Old Mutual management staff on how their sales and operations have been affected since the inception of the Act and to reflect on their experiences and perception regarding the Act. The study also assesses Old Mutual Finance customers’ level of awareness and perceptions regarding the Act. The purpose of the National Credit Act is to promote and advance the social and economic welfare of South Africans, promote a fair, transparent, competitive, sustainable, responsible, efficient, effective and accessible credit market and industry, and to protect consumers. A mixed model research was used where both qualitative and quantitative data collection techniques and analysis procedures were used and combined. For qualitative data collection, five senior management staff of Old Mutual Finance were interviewed. This entailed face-to-face interviews which were semi-structured, their responses were manually written and also digitally recorded. The quantitative method involved the use of a survey of two hundred and thirty two of their customers from four different Old Mutual Finance branches located in Johannesburg. The results of the study indicate that the National Credit Act is considered to be appropriate legislation with good intentions. However, some aspects of the legislation need to be addressed to ensure that credit providers are able to smoothly implement its rules and regulations in the lending market. Concerns pertaining to the lack of consumer knowledge or low financial literacy were also raised. Using the promax rotation and eigenvalues exceeding one, three factors namely, Knowledge of the Act, Attitudes towards the Act and Perception towards credit in general were identified which together explained the 47% of the variance for the entire set of variables. These three factors corresponded to the themes of the customer questionnaire.

The National Credit Act 34 of 2005 introduced measures in an attempt to prevent overspending by consumers and, more importantly measures to prevent credit providers from lending money to consumers who cannot afford either to pay the loan amount or the interest on the loan amount. A debtor who becomes over-indebted may apply for debt review. The NCA also provide for the reorganisation of debt of a person who is overindebted, to afford such person the opportunity to survive the immediate consequences of his financial distress. Its purpose is to inter alia, prevent reckless credit granting and address the problem of over-indebted and in particular to protect the consumer. The sequestration process in terms of the Insolvency Act 24 of 1936 may provide debt relief to individual debtors because following the sequestration order the debtor may be rehabilitated. Rehabilitation has the effect of discharging all pre-sequestration debt and further relieving the debtor of every disability resulting from sequestration. The debtor can apply sequestration by way of voluntary surrender while it is possible for a creditor to sequestrate a debtor's estate by way of compulsory sequestration. The process of compulsory sequestration is often used as a debt relief measure in form of a so-called friendly sequestration. In a friendly sequestration the debtor will arrange with a friend or a family member to whom he owes a debt that he will commit an act of insolvency in terms of section 8(g), that is, where the debtor gives written notice to a creditor that he is unable to pay all or any of his debts. When enacting the NCA, the legislature did not specifically make any mention of the Insolvency Act. The question is whether the NCA impact on the Insolvency Act. However the court in Ex Parte Ford And Two Similar Cases 2009 3 SA 376 (WCC) held that section 85 of the NCA was applicable to proceedings under voluntary surrender. The court further held that an application for voluntary surrender should not be granted where the machinery of the NCA was the appropriate mechanism to be used. In Investec Bank. v Mutemeri 2010 1 SA 265 (GSJ) the court held that section 130(1) do not apply to sequestration because an application for sequestration is not application for enforcement of the sequestrating creditor‟s claim. It is therefore not subject to the requirement of section 130(1) of the NCA. The court also held that an application by a credit provider for the sequestration of a consumer does not constitute litigation or a judicial process in terms of section 88(3). On Appeal in the case of Naidoo v Absa (391/2009)[2010] ZASCA 72 (27 May 2010) the Supreme Court of Appeal confirmed the decision of Mutemeri. The appeal court held that a credit provider need not to comply with section 129(1)(a) before instituting sequestration proceedings against a debtor. The research will be conducted as to whether the NCA impact on the Insolvency Act. / Dissertation (LLM)--University of Pretoria, 2011. / Mercantile Law / unrestricted

The National Credit Act (hereinafter the Act) introduced debt review to the Republic of South Africa in 2007. Debt review was introduced to provide debt relief to over-indebted consumers. The legislature was not able to foresee and address several implementation obstacles and accordingly courts are forced to assist in the interpretation of the Act. Courts have created some legal certainty, but there are different opinions on the correctness of these interpretational principles. This study will consider current precedents and whether the current precedents are in accordance with the intention of the legislature. Section 2 of the Act stipulates that Act should be interpreted to give effect to the purposes of the Act. The purpose of the Act is contained in section 3. One of the purposes of the Act is to promote equality between the rights of consumers and credit providers in credit agreements. This dissertation illustrates that the Act aims to achieve this equality of rights in the debt review process by the inclusion of countervailing rights in part D of chapter 4 of the Act. The legislature considered recommendations made by certain role players in the debt review process. Proposed amendments were published on 29 May 2013 in the Government Gazette for public consideration. These proposed amendments were considered in the scope of this study. The dissertation concludes that the proposed amendments need to be supplemented in order to ensure that debt review becomes and remains an effective debt relief measure for over-indebted consumers, without prejudice to the rights of credit providers. / Dissertation (LLM)--University of Pretoria, 2014. / Mercantile Law / unrestricted

A research report submitted in accordance with the requirements of the degree of Masters of Management in the Field of Public Policy (MMPP) in the Wits School of Governance (WSG), Faculty of Commerce, Law and Management at the University of the Witwatersrand, October 2017 / Even though South Africa is living in what is referred to as a constitutional democracy which is defined within the context of its Bill of Rights contained in Chapter 2 of the Constitution of the Republic of South Africa Act, 1996 (the Constitution) which is advocating for promotion of human rights, the country still finds itself in a situation where the ideals and objectives of this Constitution are still often regarded as unachievable by ordinary citizens. The Bill of Rights seeks to promote and protect full enjoyment of the rights contained in the Constitution and requires the state to realise this by developing progressive legislation and other reasonable measures for the achievement of the above, within the backdrop of the social and economic transformation purpose of the Constitution. The success and therefore the benefit of the Bill of Rights can only be calculated within the prism of policies and legislation developed in line with this Constitution and how these are implemented by those who have been mandated to do so / MT 2019

LL.M. (Banking Law) / The charging of interest and the variation thereof throughout the term of a credit agreement has, in a modern South Africa, become the rule rather than the exception. This is so because in a constant evolving economy it will not be viable for large financial institutions to commit themselves to fixed interest rates especially where a credit agreement such as a mortgage agreement may extend over many years. With this comes the question as to the extent of a credit provider’s discretion to vary interest rates and the manner in which it purports to do so. Naturally where the National Credit Act finds application in respect of a credit agreement the provisions thereof relating to interest and the variation thereof will determine whether a clause allowing a credit provider to vary the interest rate unilaterally is valid and enforceable. However in instances where the National Credit Act is not applicable to a certain credit agreement, especially in the case where the consumer is a juristic person, the interest rate levied and the variation thereof will fall to be decided in terms of the common law. The application of the common law in this regard is not without difficulty and there have been many conflicting decisions of our courts in this regard. Whilst the supreme court of appeal has finally decided on the matter of discretionary interest rate clauses it is no doubt that this issue will surface for many years to come. This dissertation explains the comparative positions of interest rate and variable interest rate clauses in terms of the National Credit Act and the common law.