Before a credit provider takes any action against a consumer that is in arrears, a credit provider must ensure that it has satisfied the provisions of section 129, section 130 and section 168 (which deals with the serving of documents) of the National Credit Act, 2005 (“NCA”). In doing this, a credit provider must provide the consumer with a notice in terms of section 129 of the NCA in which the consumer is advised about their right to refer the credit agreement to a debt counsellor, alternative dispute resolution agent, consumer court, or ombud to resolve any dispute under the agreement, before taking legal proceedings to recover debts.
Before notice in terms of 129 is sent to the consumer, the consumer must have been in arrears for at least 20 business days and before a credit provider may approach the court for an order to enforce a credit agreement a further 10 business days must have elapsed since the credit provider delivered the section 129 notice.
A section 129 notice must be in (a) writing, (b) be dated, (c) refer to the agreement which the consumer is in default of and state the default amount. The section 129 notice should also state that that the notice serves as a notice in terms of section 129 of the NCA. This however is not applicable to a credit agreement that is subject to debt restructuring order, or to proceedings in a court that could result in such an order
The section 129 notice must also be sent by registered mail and the credit provider must obtain a track and trace printout from the post office to show that the letter was in fact delivered to the correct post office.
For more information on the requirements of section 129 and 130 or for assistance in preparing a section 129 notice, please do not hesitate in contacting our offices on +27 21 200 0770.
Dingley Marshall Inc
Article drafted by Natalie Gillmer.