National Credit Act, 2005 (Act No. 34 of 2005)
Chapter 4 : Consumer Credit Policy
Part C : Credit marketing practices
74. Negative option marketing and opting out requirements
1) A credit provider must not make an offer to enter into a credit agreement, or induce a person to enter into a credit agreement, on the basis that the agreement will automatically come into existence unless the consumer declines the offer.
2) Subject to section 119(4), a credit provider must not make an offer to increase the credit limit under a credit facility, or induce a person to accept such an increase, on the basis that the limit will automatically be increased unless the consumer declines the offer.
3) A credit provider must not make a proposal to alter or amend a credit agreement, or induce a person to accept such an alteration or amendment, on the basis that the alteration or amendment will automatically take effect unless the consumer rejects the proposal, except to the extent contemplated in section 104, 116(a), 118(3) or 119(4).
4) A credit agreement purportedly entered into as a result of an offer or proposal contemplated in subsection (1), is an unlawful agreement and void to the extent provided for in section 89.
5) A provision of a credit agreement purportedly entered into as a result of an offer or proposal contemplated in subsection (2) or (3) is an unlawful provision and void to the extent provided for in section 90.
6) When entering into a credit agreement, the credit provider must present to the consumer a statement of the following options and afford the consumer an opportunity to select any of those options:
a) To decline the option of pre-approved annual credit limit increases as provided for in section 119(4), if the agreement is a credit facility; and
b) to be excluded from any-
i) telemarketing campaign that may be conducted by or on behalf of the credit provider;
ii) marketing or customer list that may be sold or distributed by the credit provider, other than as required by this Act; or
iii) any mass distribution of email or sms messages.
7) A credit provider-
a) must maintain a register in the prescribed manner and form of all options selected by consumers in terms of subsection (6); and
b) must not act in a manner contrary to an option selected by a consumer in terms of subsection (6).
75. Marketing and sales of credit at home or work
1) A credit provider must not harass a person in attempting to persuade that person to apply for credit or to enter into a credit agreement or related transaction.
2) A credit provider must not enter into a credit agreement at a private dwelling except-
a) during a visit pre-arranged by the consumer for that purpose;
b) if a credit provider visited the private dwelling for the purpose of offering goods or services for sale, and incidentally offered to provide or arrange credit to finance the purchase of those goods or services; or
c) if the credit agreement is of a prescribed category that is permitted to be entered into during a visit to a private dwelling.
3) A credit provider must not visit a person’s place of employment for the purpose of inducing the person to apply for or obtain credit, or enter into a credit agreement at such a place, except-
a) to enter into a credit agreement with the employer; or
b) if the visit results from-
i) a formal arrangement between the credit provider, on the one hand, and the employer and anyrepresentative trade union or employee, on the other; or
ii) a non-prompted invitation by the person being visited.
4) An employer who, or representative trade union that, enters into an arrangement with a credit provider as contemplated in subsection (3)(b)(i) must not receive any fee, commission, payment, consideration or other monetary benefit in exchange for making that arrangement, or as a consequence of a credit agreement entered into during or as a result of that arrangement.
5) Subsections (2) to (4) do not apply in respect of developmental credit agreements.
76. Advertising practices
1) This section does not apply to an advertisement-
a) that does not make reference to a specific credit product or credit provider, and of which the dominant purpose is to promote-
i) responsible credit practices; or
ii) the use of credit generally;
b) that generally promotes a specific credit provider, brand or type of credit agreement, but does not make specific reference to product price, cost or availability of credit; or
c) by the seller of goods or services, or on the premises of such a person, if that notice or advertisement indicates only that the person is prepared to accept payment through a credit facility in respect of which another person is the credit provider.
2) This section applies to the provider of credit that is being advertised, or the seller of any goods or services that are being advertised for purchase on credit.
3) A person who is required to be registered as a credit provider, but who is not so registered, must not advertise the availability of credit, or of goods or services to be purchased on credit.
4) An advertisement of the availability of credit, or of goods or services to be purchased on credit-
a) must comply with this section;
b) must contain any statement required by regulation;
c) must not-
i) advertise a form of credit that is unlawful;
ii) be misleading, fraudulent or deceptive; or
iii) contain any statement prohibited by regulation; and
d) may contain a statement of comparative credit costs to the extent permitted by any applicable law or industry code of conduct, but any such statement must-
i) show costs for each alternative being compared;
ii) show rates of interest and all other costs of credit for each alternative;
iii) be set out in the prescribed manner and form; and
iv) be accompanied by the prescribed cautions or warnings concerning the use of such comparative statements.
5) In any advertisement concerning the granting of credit, a credit provider must state or set out the interest rate and other credit costs in the prescribed manner and form.
6) This section does not apply to developmental credit agreements if
a) the National Credit Regulator has pre-approved a form of advertising to be used by the credit provider concerned; and
b) the credit provider has used only that pre-approved form of advertising in advertising or promoting goods, services or credit to the particular consumer.
7) When pre-approving any form of advertising as contemplated in subsection (6), the National Credit Regulator must balance the need for efficiency of the credit provider with the principles of this section.
77. Required marketing information
Any solicitation by or on behalf of a credit provider for the purpose of inducing a person to apply for or obtain credit must include a statement with the prescribed information for the particular type of solicitation.