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National Credit Act, 2005 (Act No. 34 of 2005)

Chapter 1 : Interpretation, Purpose and Application of Act

Part C : Classification and categories of credit agreements

10. Developmental credit agreements


(1) A credit agreement, irrespective of its form, type or category, is a developmental credit agreement if—
(a) at the time the agreement is entered into, the credit provider holds a supplementary registration certificate issued in terms of an application contemplated in section 41; and
(b) the credit agreement is—
(i) between a credit co-operative as credit provider, and a member of that credit co-operative as consumer, if profit is not the dominant purpose for entering into the agreement, and the principal debt under that agreement does not exceed the prescribed maximum amount;
(ii) an educational loan; or
(iii) entered into for any of the following purposes—
(aa) development of a small business;
(bb) the acquisition, rehabilitation, building or expansion of low income housing; or
(cc) any other purpose prescribed in terms of subsection (2)(a).


(2) The Minister may prescribe—
(a) additional purposes, as contemplated in subsection (1)(b)(iii)(cc), that are designed to promote the socio-economic development and welfare of persons contemplated in section 13(a);
(b) a maximum principal debt above which a credit agreement contemplated in subsection (1)(b)(i) does not automatically qualify as a developmental credit agreement; and
(c) criteria and standards to be applied by the National Credit Regulator in considering whether a credit provider’s dominant purpose for making an agreement was profit or a purpose other than profit, including but not limited to the extent to which the credit agreement concerned contributes to the socio-economic development and welfare of persons contemplated in section 13(a).