What is the National Credit Regulator of South Africa?
The National Credit Regulator (NCR) of South Africa is mandated to ensure that there is a fair environment in the credit market of South Africa. It is a government arm that falls under the Department of Trade, Industry, and Competition.
The NCR was formed to provide support and advance the social and economic standings of South Africans by regulating for a ‘fair and non-discriminatory marketplace’. According to the NCR, a fair, non-discriminatory marketplace is one that displays full access to consumer credit, characterized by responsible credit granting and credit use, as well as adequate compensation.
Why and how can I register with the NCR?
To become a credit provider in South Africa, you ought to be registered with the National Credit Regulator. This applies to everyone, even if they are providing credit to a few or thousands of people. As such, all credit providers, credit bureaus, and debt counsellors must register with the National Credit Regulator under the National Credit Act. The NCR enforces both registration and compliance with the Act.
However, there is an exemption that applies. You may be excluded from the requirement to register as a credit provider if the consumers are juristic persons with an asset value or annual turnover of at least R1 million. This exemption also applies where the juristic person concludes a large credit agreement with the credit provider, with a principal debt of a minimum of R250 000.00.
Steps to register with the National Credit Regulator in South Africa
Below are the basic steps that either a juristic person or company may follow to register with the NCR and be approved to offer credit according to the dictates of the National Credit Act. All the information or documents listed below must be sent to 127 – 15th Road, Randjespark, Midrand, PO Box 209, Halfway House, 1685. This address is provided on top of the NCR application forms.
- Determine whether you want to register as an alternative dispute resolution agent, credit bureaux, credit provider, debt counsellor, or payment distribution agent.
- Download and complete the suitable application form from this list. Proof of company registration, or you can be a sole proprietor.
- Proof of the share ownership structure of the business through a copy of share certificate(s) if the application is a company.
- Provide a certified copy(ies) of ID
- Part 7 (disqualification of natural person form)
- The police clearance certificates you provide should be no older than 6 months.
- Provide certified copies of ID or Passports of any of the following:
- Sole proprietors
- Complete and sign a board resolution (to register). Submit this document if the applicant is a juristic person
- Provide a police clearance certificate (issued by the South Africa Police Services (SAPS) for all the following:
- sole proprietors
- Proof of payment of the registration and application fees as will be discussed in the next section.
- Provide a bank letter confirming the applicant’s banking details. You can also provide a copy of a cancelled blank check.
- Provide Proof of registration with the South African Revenue Services (SARS)
What are the NCR registration fees?
The National Credit Regulator oversees different credit agencies in South Africa. Therefore, fees will not be the same for registering with the NCR. Below, we summarize the payable fees for both registration and application.
There is a mandatory non-refundable application fee of R550 that every applicant must pay regardless of the type of business they intend to register with the regulator. There is also a branch fee of R250 per location or premises where the business will be operating from. For example, if your business already has ten branches, you will be liable to pay a branch fee of R2,500 (R250 X 10).
The registration fees are set differently according to the type of business you are registering with the NCR. For example, to register as a credit provider, you will pay registration fees in line with the nine categories set out by the regulator. A credit category 1 credit provider is one with total principal debt equal to or greater than R15 billion. These will pay a registration fee of R330,000. On the other hand, a category 2 credit provider is one with a total principal debt of less than R250,000. They pay R1,000 initial registration fees. These categories are set in descending order, with category 1 being the company with the highest principal debt and category 9 the least.
Nevertheless, if you want to register as a credit bureau, you pay registration fees as follows: R11,000, plus R5 per one thousand consumer credit enquiries. But these shall not exceed R210,000. According to the NCR, “consumer credit enquiries is the number of consumer credit enquiries for the past 12 months period up to the end of the last month before the application date for registration as certified by the CEO of the applicant.”
What does the National Credit Regulator do?
The National Credit Regulator (NCR) is a regulatory body that was established in terms of the National Credit Act 34 of 2005 (the Act). The NCR is responsible for the regulation of the South African credit industry.
The primary objective of the NCR is to protect consumers against reckless and irresponsible lending. The NCR also seeks to ensure that credit providers conduct their business fairly, responsibly and transparently.
Who regulates the National Credit Act?
The National Credit Act is regulated by the National Credit Regulator (NCR). The NCR is an independent body which was established in March 2007 to administer the National Credit Act.
The NCR is responsible for regulating the credit industry in South Africa and aims to ensure that credit providers treat consumers fairly. The NCR also aims to promote responsible credit behaviour and ensure credit is accessible to those who need it.
How do I check if a company is registered with NCR?
There is a National Corporate Registry (NCR) in South Africa responsible for companies’ registration. The NCR is also responsible for the registration of Close Corporations (CCs) and Cooperatives.
The NCR is a Department of Trade and Industry (DTI) division.
If you want to check whether a company is registered with the NCR, you can do so by visiting the NCR website.
On the website, you will find a searchable database of registered companies. You can search for a company by name, registration number, or business type.
Once you have found the company you are looking for, the website will show you the company’s registration details, including the company’s name, registration number, and business type.
The process to register with the NCR could be cumbersome because there are rules that must be followed. The information provided in this article is standard and does not apply to all the types of registrations that take place at the National Credit Regulator. Documents required to register as a credit provider may have a slight difference from those to register as an alternative dispute resolution agent or credit bureaux. Therefore, always take note of these differences when registering with the NCR and ensure that you have the list of paperwork required to register your business.