The importance of fairness in credit: know your rights

South Africa marked World Consumer Rights Day on 15 March and Human Rights Day on 21 March, highlighting that fairness and dignity extend into financial matters, says Niresh Gopichand, risk director at Atlas Finance

He says credit is not only a borrowing tool but also a means of protecting households. Since 2005, the National Credit Act (NCA) has been the foundation of consumer protection, requiring lenders to act with transparency and responsibility.

“Credit affects your household stability and your long-term future. The law exists to ensure that no one is exploited simply because they require financial assistance,” Gopichand says.

Leonie van Pletzen, CEO of the Credit Association of South Africa (CASA), adds: “Every South African has the right to demand fairness and respect from lenders. These rights are not abstract ideals, but they are enshrined in law to protect ordinary people.”

Six key rights under the NCA and Consumer Act are outlined:

• Clear, upfront information: Consumers must receive a pre-agreement statement and quotation detailing loan amount, interest rate, repayment schedule, fees, and total cost of credit.
• Affordability assessments: Lenders must check affordability before granting credit. A salary increase does not automatically mean more debt is affordable. Consumers may question how affordability was calculated.
• Fair and respectful treatment: Abusive or discriminatory practices are prohibited. Consumers must be treated with dignity throughout the credit process.
• Privacy and data protection: Personal and financial information must be safeguarded. Consumers have the right to know what data is collected, how it is used, and who it is shared with. Complaints can be lodged if misuse is suspected.
• Challenge reckless lending: Credit agreements granted without proper affordability checks can be challenged and declared unlawful. “Responsible credit should empower, not entrap,” says Gopichand.
• Financial education and recourse: Consumers are entitled to financial education and may lodge complaints with the National Credit Regulator (NCR). Lenders must be registered with the NCR and industry bodies such as CASA. Informal lenders often charge excessive interest and operate outside the law.

Van Pletzen says: “As South Africa reflects on consumer protection and human rights this March, the message is clear, access to credit must go hand in hand with fairness, transparency, and accountability. Knowing your rights is the first step to protecting your financial future.”

PERSONAL FINANCE