South Africa: lending & credit regulation

Who regulates

• National Credit Regulator (NCR)

  Primary conduct supervisor for consumer credit providers under the National Credit Act.

• Prudential Authority (SARB)

  Prudential supervisor for banks and financial institutions, focusing on capital and risk management.

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Core laws & rules

• National Credit Act (2005)

  The primary legislation governing consumer credit, establishing licensing, affordability, and responsible lending standards.

• Banks Act (1990)

  The foundational prudential legislation for banks, under which the Prudential Authority issues directives on credit risk and capital.

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Licensing & registration

• Consumer Credit Provider

  All entities engaging in consumer credit must be licensed by the NCR, with exemptions for certain banks and micro-lenders under specific conditions.

• Banking License

  Banks require a banking license from the Prudential Authority to conduct credit business, subject to strict prudential standards.

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Restrictions & warnings

• Strict affordability assessments are required before granting credit to prevent over-indebtedness.

• Banks are subject to large exposure limits and capital requirements under Prudential Authority directives.

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Direction of travel

• Regulatory focus remains on prudential stability and consumer protection, with no major legislative changes anticipated in the immediate term.

Sources

1. D14 of 2025 – Large Exposure Requirements · 2025-12-04
2. D12-2025 - Credit Risk Roadmap · 2025-10-31
3. Prudential Treatment of Distressed Restructured Credit Exposures · 2025-10-22
4. Prudential Treatment of Credit Exposures Secured by Forest and Agricultural Land · 2025-08-06
5. D8-2025 - Threshold Amounts for Revised Standardised and IRB Approaches to Credit Risk · 2025-07-01
6. Guidance on the Internal Ratings-Based Approach for Credit Risk (G2-2025) · 2025-07-01
7. Submission of Consolidated Information for Domestic Systemically Important Banks · 2025-07-01
8. Threshold Amounts for the Revised Standardised and IRB Credit Risk Approaches and Liquidity Framework · 2023-09-29
9. Directive on Matters Relating to Eligible External Credit Assessment Institutions (D7-2023) · 2023-08-30
10. Directive D6/2023 on Consolidated Credit-Related Reporting for South African Domestic Systemically Important Banks · 2023-07-31
11. Regulatory Treatment of Accounting Provisions (D3/2023) · 2023-05-18
12. G9-2022 - Matters related to the credit risk models of banks · 2022-08-01
13. G6/2020: International Financial Reporting Standard (IFRS) 9 in response to the COVID-19 Pandemic · 2020-05-29
14. Treatment of restructured credit exposures due to the Coronavirus (Covid-19) pandemic · 2020-04-07
15. International Financial Reporting Standard IFRS 9 Application in Response to the Coronavirus Pandemic · 2020-03-26
16. D4/2017: Matters related to securitisation vehicles · 2017-10-02
17. Audit Implications of the Expected Credit Loss Model for Bank Auditors · 2017-05-08
18. Amendment of Regulations relating to Banks · 2016-05-20
19. G3/2016: Credit risk and accounting for expected credit losses · 2016-03-15
20. Matters Related to the Use of Support in a Bank's Credit Risk Rating Process · 2015-05-21
21. Restructured Credit Exposures · 2015-05-14
22. Amendment of Banking Regulations under the Banks Act, 1990 · 2015-03-30
23. 2015 Meetings with Bank and Controlling Company Boards on IFRS 9 and Shadow Banking · 2015-02-02
24. D9/2014: Restructured credit exposures · 2014-12-09
25. Changes to Internal Rating Systems for Calculating Minimum Required Capital for Credit Risk · 2014-07-31
26. Interpretation and Application of Criteria Relating to Exposures Secured by Residential Mortgage Bonds · 2014-02-14
27. Interpretation of Default Definition in Regulation 67 of the Regulations Relating to Banks · 2014-02-12
28. Guidance Note G3/2012: 2012 Meetings with Bank and Controlling Company Boards · 2012-02-16
29. Use of Mapping Tables by Banks, Controlling Companies and Foreign Branches for Converting National to International Credit Risk Ratings · 2011-03-09
30. C2/11: Eligible Institutions Approved by the Registrar of Banks · 2011-03-08
31. Interpretation and Application of Criteria for Exposures Secured by Residential Mortgage Bonds · 2010-12-15
32. Interpretation of definition of default as outlined in regulation 65 of the Regulations relating to Banks · 2010-06-02
33. South African Reserve Bank Guidance Note 9/2008 on Stress Testing · 2008-10-24
34. Directive 7/2008: Mapping of Fitch and Moody's Ratings to Prescribed Risk Weights · 2008-09-01
35. D5/08: Composition of board-appointed committee to approve large exposures · 2008-05-11
36. Recognition of Eligible External Credit Assessment Institutions Under the Amended Banks Act, 1990 · 2007-01-10