Supreme Court ruling clarifies contentious National Credit Act issue

3rd October 2018

Supreme Court ruling clarifies contentious National Credit Act issue

The Supreme Court Ruling on the 28 of September 2018 finally made clear one of the most contentious interpretations of the National Credit Act (NCA): when is it obligatory to register as credit provider.
 
In the case of De Bruyn v Karstens, it ruled that it is obligatory to register as a credit provider even in the instance of a single provision of credit if the amount is not less than R500 000,00 and is an arm's length transaction, despite the fact that the lender is not active participant in the credit industry.
 
The decision of the Supreme Court of Appeal has the following effects :

Overall the decision is welcomed as protection will be afforded to any business or person as borrower in terms of the National Credit Act 34 of 2005, which aim is to protect borrowers.

Written by Aidan Kenny, Director at Werksmans Attorneys