What a Registered Credit Provider Must Tell You Before You Sign in South Africa

A registered credit provider in South Africa cannot ask you to sign first and learn the cost later. Before the agreement is concluded you are entitled to a pre-agreement statement and quotation that sets out the principal debt, the annual interest rate and whether it is fixed or variable, every permitted fee, any credit insurance premium, the instalment, the number of instalments and the total you will repay. The quoted cost must be held open for a short fixed period, commonly five business days, so you can take it away and compare it. The document has to be in plain, understandable language, and you are entitled to a copy of the agreement itself.

Is the lender registered, and how do you check?

Start here, because nothing else matters if the answer is no. Only a credit provider registered with the National Credit Regulator may grant credit under the National Credit Act, and a registered provider has a registration number in the form NCRCP followed by digits. An unregistered lender is outside the Act, which means outside the fee caps, the disclosure duties and the complaint routes.

Do not accept a number on a sticker or a text message as proof. Verify it against the register held by the National Credit Regulator, which also publishes the regulations made under the Act and handles complaints about a provider's conduct. If a lender cannot produce a number at all, stop there.

What exactly has to appear in the pre-agreement statement?

Enough for you to work out the cost without a conversation:

• The principal debt — the amount advanced, plus anything added to the loan rather than paid up front.
• The annual interest rate, whether it is fixed or variable, and if variable, what it is linked to.
• The initiation fee, with whether it is paid separately or added to the loan. Added means you pay interest on it.
• The monthly service fee.
• Any credit insurance premium, shown as its own line, not merged into the instalment.
• The instalment, the number of instalments and the total of all payments, so the cost of credit is visible as one number.
• Default administration charges and collection costs that would apply if you fall behind.

That list is also a limit. The Act permits a closed set of charges — principal debt, initiation fee, service fee, interest, the cost of credit insurance, default administration charges and collection costs — and several of them are capped by regulation. A charge under a name not on that list is a question to ask before signing rather than after. The cap amounts are revised from time to time, so get the current figures from the regulator and not from a summary.

The Capfin Loan App - SIM & CALC listing on this site describes an independent, unofficial loan simulation, calculator and guide that works on figures you type in. It carries no lender's rates and cannot apply for anything, but it is useful for one thing: checking that a quotation adds up the way you were told it does.

What rights sit alongside the disclosure?

Four are worth knowing before you sign rather than after:

1. Plain language. The agreement must be in language you can reasonably be expected to understand, and you are entitled to a copy. Take it home.
2. Your own insurance. Where credit life cover is required, you generally have the right to use or cede a suitable policy of your own rather than buy the provider's.
3. Statements and settlement figures, so you can check what is actually owed.
4. A limited right to rescind. For certain agreements, notably those concluded away from the provider's registered business premises, the Act allows a short rescission window of about five business days. The precise wording matters, so check the current section rather than assuming it covers yours.

You are also entitled to a free credit report once a year from a credit bureau. Reading it before you apply shows what the lender will see, including accounts you may have forgotten.

What should make you walk away?

These are the signals, and none of them are subtle:

• No NCRCP registration number, or one that does not check out on the register.
• No written pre-agreement statement and quotation. A verbal instalment is not a disclosure.
• A fee payable before the money is paid out — an insurance, release or clearance fee demanded up front. This is the standard shape of advance-fee fraud.
• Being asked to sign blank or incomplete forms, or to sign today because the offer expires tonight.
• Being asked for your card, your PIN, your SIM, your ID book or a one-time PIN. No legitimate lender needs any of these, and keeping your card or ID as security is not permitted.
• No affordability assessment at all, or encouragement to overstate your income. Credit granted without a proper assessment can be found reckless, but you are the one left with the instalment in the meantime.

Never type an ID number, a bank account number, card details, a password or a one-time PIN into any third-party app, website or link sent to you. Apply only through a lender's own official channel, and if the conduct looks wrong, complain to the provider in writing first and then to the National Credit Regulator.

Frequently asked questions

How long is a quotation valid?

The quoted cost of credit must be held open for a short fixed period, commonly five business days, which exists so you can compare offers without pressure. Use it.

Can a lender charge a fee that is not in the quotation?

The Act permits only a closed list of charges, several of them capped. A charge outside that list, or above a cap, is a complaint to the credit provider and then to the regulator.

Must the lender tell me my interest rate, or only my instalment?

The annual interest rate, and whether it is fixed or variable, is part of the required disclosure. An instalment on its own tells you nothing about the rate, the fees or the insurance inside it.

Is a calculator app a substitute for the pre-agreement statement?

No. An independent calculator can only estimate from figures you type in. Your pre-agreement statement and quotation is the document that states your real cost, and your signed agreement governs the loan.

Ask for the registration number, then the written quotation, then read the four lines that decide the price: the rate, the initiation fee, the service fee and the insurance premium. If all four are not in writing, there is nothing to compare and nothing to sign. To check the arithmetic of a quotation on your own figures, the independent, unofficial app on Google Play is a loan simulation, calculator and guide with no account, no login and no personal data. It is not an official representative of Capfin and is not affiliated with, endorsed by, or connected to Capfin, nor with the National Credit Regulator. It does not offer loans and cannot be used to apply for one, does not process applications, disburse funds, check application status or access any account. All figures are estimates for planning only; confirm the actual terms with the credit provider directly.