South Africa: Consumer Credit

The Free State Division of the High Court recently handed down judgment in the case of Mbombi and Another v BMW Financial Services SA (Pty) Ltd...

The National Credit Regulator (NCR) was established under Section 12 of the National Credit Act, Act 34 of 2005 (NCA) to oversee the South African credit industry.

The National Credit Act 34 of 2005 (the "Act") regulates the extension of credit in South Africa and aims to protect consumers against unscrupulous credit providers.

The National Credit Regulator (NCR) has for some time expressed its concerns regarding the method used by credit providers to assess consumers' ability to afford credit (affordability assessments).

A recent debt summit in Midrand shows that there is still continued widespread abuse and exploitation of garnishee orders especially in impoverished communities.

The global financial crisis has brought about a shift in the regulation of credit rating agencies. In a step towards conforming with international efforts to regulate these bodies, South African legislators are seeking to introduce new law in the form of the current Credit Ratings Services Bill (published under Gazette No. 35022 of 7 February 2012) (the "Bill").