NCR
Introduction
Compliance is certainly a watchword at Mobiloan (Pty) Ltd.
Below are a couple of questions and answers relating to the National Credit Regulator (NCR) together with some useful links and documents.
Who or what is the NCR?
The mission of the National Credit Regulator (NCR) is to support the social and economic advancement of South Africa by regulating for a fair and non-discriminatory market place for access to consumer credit; and promoting responsible credit granting and credit use, and effective redress.
The NCR's mandate is to :
Promote and support the development of a fair, transparent, competitive, sustainable, responsible, efficient and effective consumer credit market, and to increase participation of historically disadvantaged persons, low-income persons and communities, and remote, isolated or low-density populations and communities in the consumer credit market;
Regulate the consumer credit industry by registering credit providers, credit bureaus and debt counsellors, payment distribution agents, and alternative dispute resolution agencies;
Enforce the provisions of the National Credit Act; undertake research on the nature and dynamics of the consumer credit market in order to increase knowledge of these matters;
Promote public awareness of consumer credit matters; and review legislation and report to the Minister of Trade and Industry on matters concerning consumer credit.
IMPORTANT LINKS FOR REFERENCE National Credit Regulator Website
Is Mobiloan compliant with the National Credit Act?
Absolutely, Mobiloan prides itself on providing registered credit providers with the tools they need to run their businesses.
Mobiloan has built in provisions to ensure continued compliance with, amongst other items, the National Credit Acts requirements for :
The conducting of an affordability assessment;
The review of a clients credit worthiness and history through the obtaining of a credit report;
The limitation of rates and fees in terms of the regulations;
The issuing of quotations, loan agreements and all other contracts entered into by the client during the loan application process; and
Collection and storage of supporting documentation.
What are the National Credit Act regulations?
The national credit regulations are effectively an addendum to the National Credit Act and must be read in conjunction therewith.
They are effectively additional rules or constraints governing the activities of credit providers operating in South Africa.
You can read the government gazette notice which details the regulations by clicking on the document below.
What interest rates, initiation fees and service fees can I charge?
In South Africa and indeed the international trend concerns itself with consumer protection.
With the same in mind interest rates have become heavily regulated.
You can read the government gazette notice which details the interest, initiation fees and service fees by clicking on the document below.
Mobiloan currently enables credit providers to configure loan products for the following credit types:
Unsecured Credit Transactions
Short Term Transactions
Interest Rates
| Credit Type | Maximum Allowable Interest Rate |
|---|---|
Unsecured credit transactions | Repo Rate + 21% per annum |
Short term credit transactions | 5% per month on the first annual loan; and 3% per month on all subsequent loans in a calendar year. |
Initiation Fees
| Credit Type | Maximum Allowable Initiation Fee |
|---|---|
Unsecured credit transactions | R 165 per credit agreement plus 10% of the amount in excess of R 1 000 subject to a maximum fee of R 1 050. |
Short term credit transactions | R 165 per credit agreement plus 10% of the amount in excess of R 1 000 subject to a maximum fee of R 1 050. |
Service Fees
| Credit Type | Maximum Allowable Initiation Fee |
|---|---|
Unsecured credit transactions | R 60 per month or part thereof |
Short term credit transactions | R 60 per month or part thereof |
Can I charge interest on the initiation fee?
Interest is levied on the deferred amount. This means that any amount that is not payable upfront at the commencement of the loan agreement is subject to interest which includes initiation fees.
Must I also pro rata the final service fee if the loan is repaid before month end?
Regulation 44(4) of the Regulations to the National Credit, Act 34 of 2005, applies only to the first calendar month.
The monthly service fee is not required to be charged on a pro rata basis for the calendar month in which the agreement terminates or is settled.
Are Mobiloan Loan Agreements compliant with the National Credit Act?
Yes, absolutely. Our loan agreements are based on the Form 20.2 template. This contains both the quotation and loan agreement layout.
Does Mobiloan submit my Form 39 for me?
No, unfortunately the National Credit Regulator doesn't provide the associated functionality for us to be able to submit the Form 39 for you automatically.
Mobiloan does however prepare the Form 39 for printing, review and signing.
Thereafter all that is left for you to do is submit the form.
Where are loan products configured in Mobiloan?
Loan products are configured in the Setup module in Mobiloan.
You can access the SETUP -> LOAN PRODUCT menu here.
Where do I find the loan repayment schedules?
Loan repayment schedules are available to users during the loan origination process for purposes of discussing the same with the client.
The loan repayment schedule is also available to users from the loan menu accessed via the maintenance module in Mobiloan.
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