A client asked: I would like to clarify the following regarding the National Credit Act (NCA) regulations: I understand that credit-granting business can list a business or individual who has defaulted on payment directly onto various Credit Bureau Default Listing databases. However, I am curious to know if an individual who has obtained a judgment against another individual has the authority to do the same.
Under
the NCA in South Africa, the ability to list a debtor who has defaulted on
payments is primarily reserved for credit providers, such as businesses or
individuals who have extended credit. This process is regulated to ensure
consumer protection and fair treatment.
See
this article: Can I list a debtor as a
bad payer with the credit bureaus?
Can
Individuals List Debtors?
An
individual who has obtained a judgment against another individual does have
some recourse, but there are specific conditions and limitations:
- Judgment
Listings:
A judgment listing occurs when a court has granted a judgment against a
debtor for a specific amount owed. This type of listing is automatically
reported to credit bureaus and remains on the debtor's credit profile
until it is settled or removed after five years.
- Default
Listings:
For general default listings (which indicate non-payment or slow payment),
the NCA stipulates that only registered credit providers can list
defaults. This means that if an individual is not registered as a credit
provider, they cannot directly list a debtor on the credit bureau.
- Requirements
for Listing:
If an individual has formally lent money and has followed the necessary
legal processes (like obtaining a court judgment), they may report this
judgment to a credit bureau. However, they must comply with the NCA's
requirements, which include providing prior notification to the debtor
about their intention to list any default information.
Summary of Key Points
- Credit
Providers Only:
Only registered credit providers can list defaults directly with credit
bureaus.
- Judgment
Reporting:
Individuals with court judgments can report these judgments but must
adhere to NCA regulations.
- Notification
Requirement:
Creditors must notify debtors of their intention to list defaults,
allowing them an opportunity to remedy the situation before any listing
occurs.
In
conclusion, while an individual who has obtained a judgment against another can
report that judgment, they cannot independently list defaults unless they are
recognized as a credit provider under the NCA.
