The Banking Association of South Africa - Code of Banking Practice

9.3 NCA credit agreements

For your information

Parts 9.3, 9.4, 9.5 and 9.6 apply only to customers who enter into NCA credit agreements to which the NCA applies.

Your bank will apply the NCA to a credit agreement concluded with you if:

you are a natural person; or
you are a trust with one or two trustees (and the trustees are not juristic persons); or
you are a stokvel.

It will exclude all other customers. The pronoun ‘you’ used in this part has a corresponding meaning.

Take note

Binding yourself as surety or guarantor for someone else’s debt is risky, as you are effectively undertaking to take on the responsibilities of the other person if that person does not honour the responsibilities in accordance with the terms and conditions agreed to between that person and the bank.

Your role

You must make sure that you do not extend yourself beyond your financial means.
You must provide complete and accurate information to us as part of the credit application process.
If we grant credit to you, you must consider whether you have sufficient credit insurance cover to protect you and/or your dependants if you lose your regular income (such as through loss of employment, a disability, or death). You can obtain your own insurance, or we can offer you a suitable credit insurance policy.
You must obtain independent legal advice before agreeing to be a surety or guarantor.

Take note

Our role

We will not create unreasonable barriers for you to apply for our credit products.
We will provide you with sufficient information to enable you to decide if the credit product you are applying for will meet your needs and is suitable for your financial situation.
We will extend credit to you in a manner that is responsible and that matches your financial capability to make sure, as far as possible, that you are not extended beyond your financial means.
To help us extend credit responsibly to you, and according to and within your financial means, we depend on your cooperation and the full and accurate disclosure of your financial obligations at and during the application stage.
We may help you to get a suitable credit insurance policy (if there are products that meet your needs) to protect you and/or your dependants if you lose your regular income (such as through loss of employment, a disability, or death).
Before extending credit, we will:
assess whether you understand and are aware of the risks and costs of the proposed credit and your rights and obligations in terms of the NCA credit agreement;
assess your ability to afford and to repay the credit you applied for.

Take note

A credit assessment considers a range of factors, such as:

your income and expenses or a statement of assets and liabilities or both,
how you have handled your financial affairs in the past,
how you have conducted your previous and existing accounts with us,
information obtained from credit risk management services and related services, and other appropriate parties, such as credit bureaus, employers, other lenders, and landlords, and
any security or collateral provided.

provide you with the costs and a copy of the required terms and conditions of the credit you applied for before you accept the NCA credit agreement;
if you take out credit insurance through us, explain how you pay the premium, as well as key benefits and exclusions;
if we decline your application for credit and you request the reason(s), provide you with the main reason(s) in writing.

Take note

Reasons can include:
the overall credit score;
a result from information obtained from credit bureaus;
the outcome of the credit assessment;
overindebtedness; or
a specific policy of our bank.
With automated credit-scoring systems it is possible that these reasons are not explicit and that we will provide general reasons as above.

Take note

Reasons can include:
the overall credit score;
a result from information obtained from credit bureaus;
the outcome of the credit assessment;
overindebtedness; or
a specific policy of our bank.
With automated credit-scoring systems it is possible that these reasons are not explicit and that we will provide general reasons as above.

Term	Explanation
Access credentials	The way you access your digital banking services, including your access code, password, or other unique means of personal identification.
Agent	A third party, either a company or a person, that your bank appoints to render a service. This can include third-party debt collection agencies that collect debts on behalf of your bank.
Applicable laws	Any laws in force from time to time; and any applicable industry code, guidance, policy, or standard enforceable by law; or any order that is set out by a regulator.
ATM (automated teller machine)	A machine that you use to withdraw cash and to access other banking services, including balance enquiries and prepaid purchases.
Banking app	An application on your device that allows you to transfer money from one of your accounts to another, pay bills, see statements and perform other transactions.
Basic banking services	The opening, operation, and maintenance of transactional accounts.

Term	Explanation
POPIA	The Protection of Personal Information Act, 4 of 2013, that aims to promote the protection of personal information processed by public and private bodies; introduce certain conditions so as to establish minimum requirements for the processing of personal information; provide for the establishment of an Information Regulator to exercise certain powers and to perform certain duties and functions in terms of this Act and the Promotion of Access to Information Act, 2000; provide for the issuing of codes of conduct; provide for the rights of persons regarding unsolicited electronic communications and automated decision making; regulate the flow of personal information across the borders of the Republic; and provide for matters connected therewith.
Proliferation financing (PF)	Any act of providing funds or financial services that are used, in whole or in part, for the manufacture, acquisition, possession, development, export, trans-shipment, brokering, transport, transfer, stockpiling, or use of nuclear, chemical or biological weapons and their means of delivery and related materials in contravention of national laws or, where applicable, international obligations.
Promotional competition	A competition or game that we conduct for the purpose of promoting our products and/or services and where we distribute prizes to participating winners. Take note Your bank will apply the principles in this Code to a promotional competition where you are a: natural person; OR juristic person; trust or partnership, your asset value or annual turnover is less than R2 million. AND Where the Consumer Protection Act 68 of 2008 applies.

Term	Explanation
NCA credit agreement	A credit agreement as defined in the NCA with a customer to which the NCA applies. Take note Your bank will apply the NCA to a credit agreement concluded with you if you are a: natural person; or trust with one or two trustees (and the trustees are not juristic persons); or stokvel.
Password	A string of characters that allows you to access various services (such as digital banking, your device, or your email account) and that is also used for identification. Take note If there is any occasion that you are given a temporary password, you must change this to your own unique password.
Person	A natural and a juristic person. Take note Where parts of this Code apply only to persons and the pronoun ‘you’ is used, it means persons in that part.
Personal customer	Natural persons or sole proprietor who maintain an account or who receive other services from a bank. Take note Where parts of this Code apply only to personal customers and the pronoun ‘you’ is used, it means personal customers in that part.

Term	Explanation
Fixed interest rate	An interest rate that remains unchanged and not affected by market rate fluctuations for the specified period of the loan or credit agreement or other product.
Integrity	To be accurate, consistent, and reliable.
Interest	The amount we charge you in respect of the amount you owe us; or the amount we pay you in respect of for example, your savings or investment account, usually expressed as a percentage with reference to a period, such as per annum.
Internet banking	An internet-based system that is provided by us and allows you to transfer money between your accounts, pay bills, see statements, and perform other transactions.
Juristic person	Includes a trust, partnership, association, body of persons, body corporate, company or close corporation or similar entities with legal rights and duties either incorporated in or outside the Republic of South Africa, which has legal personality or enjoys a similar status in terms of which it may enter into contractual relations and legal proceedings. Take note Where parts of this Code apply only to juristic persons and the pronoun ‘you’ is used it means juristic persons in that part.
Loyalty credit or award	Any benefit or a right to goods, services, or other benefits (including points, credits, tokens, devices or other intangible or tangible things that can accrue to you) that you can accumulate and entitles you to certain goods, services or benefits that are part of a loyalty programme.

Term	Explanation
Loyalty programme	Any arrangement or scheme where a supplier of goods or services or a similar entity offers or grants any loyalty credit or award in connection with a transaction or agreement to you. Take note Your bank will apply the principles in this Code to a loyalty programme where you are a: natural person. OR juristic person; partnership or trust; and your asset value or annual turnover is less than R2 million. AND Where the Consumer Protection Act 68 of 2008 applies.
Money laundering (ML)	Any activity that has or is likely to have the effect of concealing or disguising the nature, source, location, disposition, or movement of the proceeds of unlawful activities, or any interest that anyone has in such proceeds.
Natural person	An individual and sole proprietor. Take note Where parts of this Code apply only to a natural person and the pronoun ‘you’ is used, it means a natural person in that part.
NCA	The National Credit Act, 34 of 2005, that aims to regulate the business of credit providers and places a variety of obligations on credit providers (mainly aimed at protecting credit consumers), including the prevention of reckless lending practices and measures to enhance disclosure of information to credit consumers.

Term	Explanation
Promotional offer	An offer we make you of a prize, a reward, gift, free goods or services, a price reduction or other benefit, such as a voucher entitling you to a price reduction or other benefit. Take note Your bank will apply the principles in this Code to a promotional offer where you are a: natural person; OR juristic persons; trust or partnership; your asset value or annual turnover is less than R2 million. AND Where the Consumer Protection Act 68 of 2008 applies.
Reasonable	Justifiable and comparable to the service provided.
Sanctions	Restrictions on activities that relate to particular countries, goods and services, or persons and entities. Take note South Africa implements the targeted financial sanctions (TFS) that originate from the United Nations Security Council resolutions under Chapter VII of the Charter of the United Nations (UNSCR). For these sanctions to be given effect FICA requires accountable institutions to freeze property and transactions pursuant to financial sanctions imposed in the UNSCR.
Security	Items of value, such as a mortgage bond registered over a property, share certificates and life policies, which represent assets used as support for a loan or other credit facilities. Take note If you do not repay the loan for which you have provided security, we have the right to dispose of the security.

Term	Explanation
Personal information	Information relating to an identifiable, living, natural person and, where it is applicable, an identifiable, existing juristic person, including, but not limited to: information relating to the race, gender, sex, pregnancy, marital status, national, ethnic, or social origin, and colour, sexual orientation, age, physical or mental health, wellbeing, disability, religion, conscience, belief, culture, language, and birth of the person; information relating to the education or the medical, financial, criminal or employment history of the person; any identifying number, symbol, email address, physical address, telephone number, location information, online identifier, or other particular assignment to the person; the biometric information of the person; the personal opinions, views, or preferences of the person; correspondence sent by the person that is implicitly or explicitly of a private or confidential nature or further correspondence that would reveal the content of the original correspondence; the views or opinions of another individual about the person; and the name of the person if it appears with other personal information relating to the person or if the disclosure of the name itself would reveal information about the person.
Phishing	The fraudulent practice of sending emails or other messages claiming to be from reputable companies to make individuals reveal personal information, such as passwords and credit card numbers.
PIN (personal identification number)	A number that is provided to you or that you choose on a strictly confidential basis, such as a card PIN that will enable you to draw cash and access other services from an ATM or point-of-sale device and that can also be used as an authentication mechanism.

Term	Explanation
Credit agreement	A legal contract in terms of which we lend you a certain amount of money for a specified period or finance movable goods and that outlines the terms and conditions associated with the contract, including your periodic repayments of the loan plus interest or, in the event of a lease, the monthly rental. The NCA does not apply to your credit agreement with your bank if: you are a juristic person (subject to the below principles regarding trusts); or you are a trust with three or more trustees; or you are a trust with one or two trustees, but the trustees are juristic persons; or you are a partnership; and your asset value or annual turnover is R1 million or more.
Customer	A personal customer and an SMME. Take note Where parts of this Code only apply to a customer of a bank and the pronoun ‘you’ is used, it means customer in that part.
Debit order	A mandate, being a written, verbal, or electronic authority that you give to a service provider, allowing a service provider to debit your bank account.
Deposit	Putting money into an account, thereby increasing the credit balance, or reducing any debit balance.

Term	Explanation
Demand guarantee (or on-demand guarantee)	An undertaking (promise) that someone (or an entity), called the guarantor, gives the beneficiary of the guarantee that the guarantor will satisfy (pay) on demand the agreed amount of money (which often relates to the debts of another, called the principal debtor). Take note A demand guarantee is a primary obligation and is not dependent on the existence of any other debt or agreement. Any disputes between the parties about the underlying debt or agreement do not impact this obligation – the guarantee must be paid on demand.
Device	A tablet, cellphone and wearable or similar technology.
Device credentials	Includes but is not limited to: a password, passcode, unlock pattern and login details used as a method of accessing a device or authorising a transaction through a device.
Digital banking	Cellphone banking, internet banking and a banking app or other digital means.
Direct marketing	Us approaching you in person or by mail or by electronic communication, including email, SMS, and automatic calling machines, for the direct or indirect purpose of promoting or offering to supply, in the ordinary course of business, any goods or services to you; or requesting you to make a donation of any kind for any reason. Take note An automatic calling machine makes automated calls without human intervention.
Dormant account	An account on which you have initiated no activity for a period that we have established in advance and in accordance with the rules relating to the specific type of account.

Our products

9.3 NCA credit agreements

For your information

Take note

Your role

Take note

Our role

Take note

Take note

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