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.

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.

Thesis (MBA (Business Management))--University of Stellenbosch, 2010. / ENGLISH ABSTRACT: The National Credit Act came into being on the 1st of June 2007 and besides its other objectives was intended to make credit more accessible to all South Africans, to stop unreasonable practices by lenders and to protect consumers against reckless lending. This research study investigates the credit environment for the period since the implementation of the Act up to the fourth quarter of 2009 to determine whether South African credit users are indeed better off or whether we are heading for a credit crisis. A literature review was conducted to investigate the extension of credit to households during the period under review and to investigate consumers’ ability and willingness to repay their debt. Due to the global and local financial crisis that happened during this period and the losses and wealth destruction that ensued, the research was extended to consider the influence of the macroeconomic situation on the debtors’ ability to honour their debt commitments. To determine whether South African households are heading for a credit crisis the researcher reviewed literature relating to the financial vulnerability of households, the application of their monthly disposable income, the main reasons for entering into credit agreements, and lastly the extent of over indebtedness. The findings indicate that credit has indeed become more accessible to all South Africans as the number of credit active consumers continued to increase from quarter to quarter. With regards to the cost of credit and the minimum qualifying criteria, credit also became more accessible as individuals earning as little as R1 500 per month became eligible for credit and store cards that used to be exclusive to higher income earners. During the period under review the standing of credit active consumers continued to deteriorate with only 54% of credit active users classified as current at the end of the period, almost 10% lower than before the implementation of the act. It was also found that macroeconomic influences from around the world had a real influence on the ability of credit active consumers to honour their financial commitments. Increased interest rates, inflation, higher transport and energy costs, unemployment and many other factors influenced the income available for and the ability to repay debt over the period under review. Lastly it was found that households are increasingly vulnerable to any changes in their income, expenses, savings or debt position. It is increasing to such an extent that more than 50% of all credit active consumers surveyed during a previous study admitted to borrowing in order to re-pay debt and that a relatively large percentage of users are committed to debt repayments for more than 100% of their monthly income. These findings support the opinion that a credit crisis is on the loom in the South African credit industry. Due to the relatively short period covered by the research stretches and the multitude of income groups and credit agreements included, more research is needed to make specific recommendations to improve the position of credit active consumers. The challenges facing the industry are further complicated by the need credit and other needs of the lower income earners, the required price-for-risk-policies of credit providers and the low levels of financial education amongst users. All three these themes require more research. / AFRIKAANSE OPSOMMING: Die Nasionale Kredietwet wat op 1 Junie 2007 in werking getree het het onder meer ten doel gehad om krediet meer toeganklik te maak vir alle Suid Afrikaners, om onbillike praktyke deur krediegewers stop te sit en om gebruikers te beskerm teen roekelose kredietverlening. Hierdie navorsing verken die kredietomgewing vir die tydperk sedert inwerkingtreding van die wet tot en met vierde kwartaal van 2009 ten einde vas te stel of Suid Afrikaanse gebruikers inderdaad beter daaraan toe is, en of ons afstuur op n krediet krisis. ‘n Literatuurstudie is onderneem om die toestaan van die verskillende tipes huishoudelike krediet tydens hierdie termyn te ondersoek, sowel as die gebruikers daarvan se gewilligheid en vermoë om hul maandelikse skuldverpligtinge na te kom. Vanwee die ernstige finansiële krisis wat tydens hierdie periode in die wêreld en in Suid Afrika grootskaalse verliese en welvaartsvernietiging tot gevolg gehad het, is die literatuurstudie uitgebrei om ook oorweging te gee aan die invloed van hierdie gebeure op skuldenaars se vermoë om hul skuldverpligtinge te diens. Ten einde vas te stel of Suid Afrikaanse huishoudings afstuur op ‘n kredietkrisis het die navorser literatuur bestudeer rakende die finansiële kwesbaarheid al dan nie van huishoudings, die aanwending van hul beskikbare inkomste, die redes vir huishoudings om geld te leen en laastens die omvang van gebruikers wat meer veskuldig is as wat hulle kan bekostig. Die bevindinge dui daarop dat krediet weliswaar meer toeganklik is vir alle Suid Afrikaners aangesien die aantal krediet gebruikers gedurende die tydperk van kwartaal tot kwartaal gegroei het. Wat betref die koste daarvan en die minimum vereistes daarvoor het krediet ook meer toeganklik geword, en kwalifiseer individue wat so min as R1 500 per maand verdien nou vir kreditkaarte en winkel krediet wat voorheen net beskore was vir die hoër inkomste groepe. Tydens hierdie periode het die status van kredietgebruikers verder verswak en het die persentasie kredietgebruikers wat op datum is met hul verpligtinge so laag as 54% gedaal; bykans 10% minder as voor die inwerkingtreding van die wet. Daar is verder bevind dat makro ekonomiese toestande in die res van die wêreld en Suid Afrika ‘n daadwerklike invloed het op die vermoë van kredietgebruikers om hul skuldverpligtinge na te kom. Stygende rentekoerse, inflasie, duurder vervoer en energiekoste, werkloosheid en vele ander faktore het die kontant beskikbaar vir en die vermoë om skuld te delg baie nadelig geraak oor heirdie tydperk. Laastens is bevind dat huishoudings toenemend kwesbaar is vir enige veranderinge in hul inkomste, uitgawe, spaar of skuld verpligtinge. Soveel-so dat meer as 50% van alle gebruikers van krediet erken dat hulle by tye geld geleen het om ander skuld te betaal, en dat ‘n beduidelnde persentasie gebruikers tot meer as 100% van hul besteebare inkomste verbind is vir maandelikse terugbetalings. Bogenoemde bevindinge ondersteun die opinie dat daar n dreigende krisis in die Suid Afrikaanse kredietomgewing is. Aangesien hierdie navorsing beperk is tot ‘n relatiewe kort termyn en dit ‘n groot spektum van inkomstegroepe en kredietooreenkomste dek, is verdere navorsing nodig om spesifieke aanbevelings te maak ten einde Suid Afrikaanse kredietgebruikers in ‘n beter posisie te plaas. Die uitdagings in die industrie word verder gekompliseer deur die krediet en ander behoeftes van laer inkomstegroepe, die noodsaaklikheid vir uitleners om hul produkte te prys vir die inherente risikos wat daaraan gebonde is en die lae vlak van finansiële opleiding onder gebruikers. Al drie hierdie temas benodig verdere navorsing.

LL.M. (Commercial Law) / When a debtor runs into financial problems and starts neglecting to satisfy his financial obligations as and when they fall due, there are various statutory procedures or remedies available to both the debtor and his creditor(s). The first and most obvious remedy available to the creditor is to demand the satisfaction of the outstanding claim by the issuance of a letter of demand, followed by a summons and subsequent court proceedings in which the creditor will claim what is due to him. If the debtor still neglects to satisfy the judgement debt, the creditor may proceed to have the judgement enforced by means of a warrant of execution in terms of which the debtor’s property will be attached and be sold at a public auction. Another procedure that is available is for either party to apply for a sequestration order in terms of the Insolvency Act.3 The Insolvency Act provides for two ways in which a debtor’s estate may be sequestrated. These two ways have their own separate requirements. The two ways are: 1. Voluntary surrender; and 2. Compulsory sequestration.

Thesis (MDF)--Stellenbosch University, 2008. / ENGLISH ABSTRACT: High interest rates on credit products in South Africa are not unusual. This would be beneficial to the South African consumers if the cost of incurring these credit products was lower than the benefit derived from incurring them .This is unfortunately not the case to the majority of the South African population. The unlikelihood of this situation is a direct result of the lack of access to appropriate savings and insurance products to a large number of South Africans. Most South Africans use credit, in the form of microloans to augment their consumption patterns. The majority of South Africans do not have a culture of saving; therefore they use credit as a substitute for the lack of savings when consumption patterns exceed income. Using credit as a substitute for the lack of savings becomes extremely costly for low income earners. The result is a perpetual dependence on credit, lack of accumulation of wealth and a lack of improvement in their standard of living. The perpetual dependence on credit has brought about unscrupulous lenders who take advantage of the low income earners dependency on credit for their daily existence. It is due to such exploitations that the South African government through its Department of Trade and Industry (DTI) intervened to bring normality in the South African credit market. This intervention was done through the promulgation of the National Credit Act (NCA), Act No.34 of 2005. The purpose of this study is to focus on a sub set of the credit providers in South Africa known as housing microfinance (HMF) lenders. The study explores the impact of the National Credit Act in the South African credit industry. The Act’s intentions are elaborated and the reality of the implementation of the Act on the drivers of profitability for the housing microfinance institutions is measured. The finding is that housing microfinance institutions have to restructure their business processes in order to be profitable and sustainable in the ambit of the National Credit Act. / AFRIKAANSE OPSOMMING: Vir menige finansiële produkte in Suid-Afrika is rentekoerse wat wissel tussen 80 en 150 persent is nie ongewoon nie. In ekonomiese terme kan verbruikers slegs voordeel trek uit hierdie hoë rentekoerse as die koste om hierdie krediet te verkry laer is as die voordeel wat voortspruit uit die aangaan van die koste. Hierdie situasie is hoogs onwaarskynlik in die oorgrote meerderheid van gevalle in Suid-Afrika. Die onwaarskynlikheid van hierdie situasie is die direkte gevolg van die gebrek aan toegang tot toepaslike spaar- en versekeringsprodukte vir ‘n groot aantal Suid-Afrikaners. Die meeste Suid-Afrikaners gebruik krediet (naamlik mikrolenings) om hulle verbruikerspatrone aan te vul. Die gebruik van krediet as ‘n plaasvervanger vir spaargeld word uitermate duur vir die lae-inkomste verdiener. Die gevolg is ‘n ewigdurende afhanklikheid van krediet, geen akkumulasie van welvaart nie en ‘n gebrek aan verbetering van lewenstandaard. Die ewigdurende afhanklikheid van krediet het gewetenlose uitleners geskep wat die lae-inkomste verdieners uitbuit wat afhanklik is van krediet vir hul daaglikse bestaan. Dit is as gevolg van hierdie tipe uitbuiting dat die Suid-Afrikaanse regering deur sy Departement van Handel en Nywerheid tussenbeide getree het om normaliteit te bring in die Suid-Afrikaanse kredietmark. Hierdie intervensie is gedoen deur die uitvaardiging van die Nasionale Kredietwet, Wet No. 34 van 2005. Die doel van hierdie studie is om te fokus op ‘n onderdeel van die kredietverskaffers in Suid-Afrika bekend as die behuising-mikrofinansiering-uitleners. Die studie ondersoek die impak van die Nasionale Kredietwet in die Suid-Afrikaanse kredietindustrie. Die Wet se oogmerke word uiteengesit en die realiteit van die implementering van die Wet op die drywers van winsgewendheid vir die behuising-mikrofinansiering-instansies word gemeet. Die bevinding is dat behuising-mikrofinansiering-instansies hulle besigheidsprosesse moet herstruktureer ten einde meer winsgewend en volhoubaar te wees binne die strekking van die Nasionale Kredietwet.

M.Phil. (Economics) / There has been increasing focus on banking system stability worldwide, particularly due to the recent financial crisis experienced and the resultant adverse economic effects. In the case of a developing country like South Africa (SA), the stability of the banking system is even more important as it is crucial for the achievement of the country’s development goals. Credit extension is also a core component for facilitating economic and social development in the country. The downside risk attached to credit extension is that once it reaches a point of being excessive it can have a destabilising effect on the banking system and the economy. SA has experienced a rapid increase in credit extension since 2001, which prompted the implementation of the National Credit Act (NCA), with the intention of regulating the credit industry and improving the practices therein. More recently, further concerns have been raised by regulatory authorities around the possibility of an asset bubble in the SA economy as a result of the level of unsecured credit extended in the country. The objective of this study therefore is to investigate the impact of the NCA on risk, both credit and systemic, in the banking system. This is important, as investigating and understanding the impact of credit controls, like the NCA, on risk in the banking system is critical to supporting the SA development agenda. The findings of this study show that the NCA has been successful in reducing credit risk in the banking system, even though this was by default and not through the stated intention of the Act. This was achieved through the introduction of the affordability requirement into the credit assessment process. This study highlights however, that there are still areas of improvement which can be made to the NCA to increase its effectiveness in preventing excessive credit extension.

The National Credit Act aggressively addresses problems in the South African credit market. The purpose of the NCA is to promote socio-economic and ethical values that will serve to protect consumers, through the application and enforcement of various laws. The research was conducted in the Durban area. Literature was surveyed with the aim to determine the views of Durban consumers concerning the National Credit Act. The study adopted an exploratory and quantitative research method using a survey (questionnaire) as its main data-collection instrument. This was administered via email. The sampling technique used is a non-probability sampling with a target population comprising of natural persons in the Durban area, who have been affected by credit. Data were analysed using the SPSS statistical package, which was appropriate for this research since its nature was quantitative rather than qualitative. Significance and correlations were the basis of the data analysis in this research and cross-tabulations were used in order to enable presentation of results. Only the variables that were relevant to the research questions were used for further analysis after the significance tests were done. The findings on the research reflected that most of the respondents had higher education degrees, which indicated that the research covered well-educated people; most respondents were satisfied with the way the NCA was explained when it was introduced, although the research highlighted a need for further consumer awareness of the Act to eliminate major default. Some recommendations that include the further research on the same topic with a larger sample were made. It is concluded that it is necessary to make improvements on the Act. / MBA. University of KwaZulu-Natal, Durban 2013.

Thesis (MBA (Business Management))--Stellenbosch University, 2008. / ENGLISH ABSTRACT: The banking industry is one of the most regulated industries in the world. The majority of these regulations are drafted to provide protection to consumers and investors and to ensure the systemic stability of the economy. South African banks, like many of their international counterparts, face a plethora of financial regulation aimed at ensuring stability and protection. In addition to these regulations, South Africa's prior exclusionary policies have resulted in the post-democratic government prescribing additional regulation, in part to address the economic duality that exists within the South African economy and in part to offer adequate protection to the most vulnerable in the society. The National Credit Act (NCA) is one such piece of legislation that has introduced a new era of consumer credit regulation and practice, bringing about wholesale changes to the consumer credit industry. The NCA and more than 260 other financial regulations in South Africa have a significant impact on banks, with each piece of legislation resulting in banks having to adapt to the changing environment (Nyamakanga, 2007). Using the four big banks' implementation of the NCA as a case study, the present study aims to establish if an integrative change management strategy could assist banks in effectively implementing financial regulation. The following aspects of the banks' implementation of the NCA were researched: • Effectiveness of financial regulation. • Current barriers and challenges to the implementation process. • Effect of these challenges on banks. • Impact on staff and customers. • Methods used to overcome the challenges. • Future challenges of the NCA. • Support structures used during implementation. • Use of change management principles. • Recommended strategies for future regulatory changes. • Recommended changes to the NCA. Detailed interviews were conducted with the overall NCA project leaders of each of the four big banks, namely, Absa, FNB, Nedbank and Standard Bank. The method of content analyses was used to analyse the qualitative data collected through in-depth interviews and the outcomes thereof formed the basis of the conclusions drawn. The study found that there were numerous challenges that the banks faced during the implementation of the NCA, the most common and significant as recognised by the population include, the magnitude of the Act, difficulty in interpreting the Act, the process of debt counselling and the associated costs of implementation. The study further found that using the principles of change management enhanced the banks' ability to implement the NCA. Conclusions drawn on the present study are confined to desktop research and semi-structured interviews conducted with the participating banks. It might be useful for future studies on the subject to include a broader population base which focuses on additional pieces of financial legislation in order to further enhance the findings of the present study. / AFRIKAANSE OPSOMMING: Bankwese is tans een van die mees gereguleerde industriee ter wereld. Die meerderheid van hierdie regulasies is ontwerp vir die beskerming van verbruikers en beleggers asook om die sistemiese stabiliteit van die ekonomie te handhaaf. Suid-Afrikaanse banke, soos talle van hul oorsese teenstukke, verduur talle finansiele wetgewing gemik op beskerming en stabiliteit. Die gewese uitsluitende Suid-Afrikaanse wette het veroorsaak dat die huidige demokratiese regering addisionele wetgewing voorskryf, gedeeltelik om die tweesydige Suid-Afrikaanse ekonomie aan te spreek en gedeeltelik om genoegsame beskerming aan die kwesbaarste van die gemeenskap te bied. Die Nasionale Krediet Wet (NKW) bied 'n nuwe era van verbruikerswetgewing en -praktyk aan wat terselfdertyd grootskaalse veranderinge op die verbruikers krediet bedryf teweegbring. Die NKW tesame met meer as 260 ander Suid-Afrikaanse finansiele wetgewing het 'n groot uitwerking op banke, met elke wet wat veroorsaak dat banke moet aanpas by die veranderlike omgewing (Nyamakanga, 2007). Deur om die vier groot banke se uitvoer van die NKW as 'n gevallestudie te gebruik, is die doel van hierdie studie om vas te stel of 'n geintegreerde veranderingsbestuurstrategie banke kan help met die doeltreffende uitvoering van finansiele wetgewing. Die volgende aspekte van die banke se uitvoering van die NKW is ondersoek: • Doeltreffendheid van finansiele regulasie. • Huidige versperrings en uitdagings tot die uitvoeringsproses. • Uitwerk van uitdagings op banke. • Uitwerking op personeel en verbruikers. • Metodiek gebruik om uitdagings te bowe te kom. • Toekomstige uitdagings van die NKW. • Ondersteunende strukture gebruik tydens uitvoering. • Gebruik van veranderingsbestuurbeginsels. • Aanbeveling van strategiee vir toekomende wetgewende veranderings. • Aanbeveling van veranderings tot die NKW. 'n Volledige onderhoud is gevoer met die projekleiers van elk van die vier groot banke, naamlik, Absa, FNB, Nedbank en Standard Bank. Inhoudsanalise was gebruik om die kwalitatiewe data te analiseer en die uitkoms daarvan vorm die basis van die gevolgtrekkings. Die studie dui aan dat banke baie uitdagings getrotseer het gedurende die uitvoer van NKW, die gewigtigste en algemeenste SODS herken deur die bevolking sluit in, die grootte van die Wet, moeilikheid in vertolking van die Wet, die skuldberadingsproses en die begeleidende koste van wetstoepassing. Die studie dui verder dat die beginsels van veranderingsbestuur banke se vermoe om die NKW uit te voer verbeter. Gevolgtrekkings aangaande die huidige studie is beperk tot "desktop" navorsing en half-gestruktureerde onderhoude met die deelnemende banke. Dit mag van waarde wees vir toekomstige studies om 'n bree bevolkingsbasis in te sluit met addisionele finansiele wetgewing wat die bevindings van die huidige studie kan bevorder.

M. Tech. Business Administration / This study assessed the alignment of balloon payments offered to customers within the provisions of the National Credit Act, 2005 (Act No 34 of 2005), by exploring whether car buyers had been made aware of and understood the nature of their contractual obligations when they signed a balloon payment agreement. Based on the simple random sampling approach, a structured questionnaire was used to collect primary data from the sample of 71 respondents who had purchased motor vehicles using the balloon payment financing method.