Credit providers have limited but real rights to terminate debt review under the National Credit Act. Section 88(3) provides that a credit provider may give notice to terminate the debt review arrangement and proceed to enforce the credit agreement if the consumer has been in default for at least 20 business days.
A credit provider can act on this right if:
• You have missed your restructured debt review instalments for 20 or more business days.
• The debt review proposal was rejected and creditors never accepted the restructuring terms.
• No court order was obtained within the prescribed periods and the debt review process was not completed.
The credit provider must give you written notice of the breach and allow you an opportunity to remedy it before proceeding. Credit providers receiving regular restructured payments rarely exercise this right because debt review benefits them: they continue receiving payments and are protected from the consumer declaring insolvency.
The most common situation where credit providers exercise this right is where the consumer has stopped paying entirely. In that case, the credit provider can apply to court to terminate the debt review as it relates to their specific credit agreement.
If a credit provider terminates debt review for a specific account, that account falls outside debt review protection and the credit provider can take legal action for that account. Remaining accounts may still be under debt review.
If you have received termination notices from credit providers, contact NDRC immediately at 041 012 5036. There may be grounds to oppose the termination or to accelerate the removal process.