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

Chapter 5 : Consumer Credit Agreements

Part E : Alteration of credit agreement

118. Reductions to credit limit under credit facility


(1) At any time the consumer under a credit facility, by written notice to the credit provider, may—
(a) require the credit provider to reduce the credit limit under that credit facility; and
(b) stipulate a maximum credit limit that the consumer is prepared to accept.


(2) After receiving a notice in terms of subsection (1), the credit provider must give the consumer written confirmation of—
(a) the new credit limit, which must not exceed the maximum limit stipulated by the consumer, if any; and
(b) the date on which the new credit limit is to take effect, which may not be more than 30 business days after the date of the notice from the consumer.


(3) Subject to sections 61 and 66, the credit provider under a credit facility, by written notice to the consumer, may reduce the credit limit under that credit facility to take effect on delivery of the notice.


(4) If, at the time a new credit limit takes effect in terms of this section, the settlement value under that credit facility is higher than the newly established credit limit, the credit provider must not treat that excess as an over-extension of credit for the purpose of calculating the minimum payment due at any time.


(5) A credit provider must not charge the consumer a fee for reducing a credit limit.