Court rules on applying for credit

The High Court has issued a major ruling in favour of retailers, Foschini and Mr Price, against the Minister of Trade and Industry and the National Credit Regulator.

In the judgement, the court ordered that regulation 23A(4) of the regulations made by the Minister of Trade and Industry under s82(2) read together with s171(1) of the National Credit Act 34 of 2005 be set aside.

Effectively what this means is that there is no longer any need to collect any particular form of documentation proving income when applying for credit, explained director at Norton Rose Fulbright, Lauren Fine, who represented the retailers in the matter.

Accordingly the court was of the opinion that the section frustrates the aim of the National Credit Act, which is to ‘promote the development of a credit market that is accessible to all South Africans, and in particular to those which have historically been unable to access credit under sustainable market conditions’.

Read the full article here.