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

Chapter 5 : Consumer Credit Agreements

Part F : Rescission and termination of credit agreements

123. Termination of agreement by credit provider


(1) A credit provider may terminate a credit agreement before the time provided in that agreement only in accordance with this section.


(2) If a consumer is in default under a credit agreement, the credit provider may take the steps set out in Part C of Chapter 6 to enforce and terminate that agreement.


(3) A credit provider in respect of a credit facility may—
(a) suspend that credit facility at any time the consumer is in default under the agreement; or
(b) close that credit facility by giving written notice to the consumer at least ten business days before the credit facility will be closed.


(4) A credit agreement referred to in subsection (3) remains in effect to the extent necessary until the consumer has paid all amounts lawfully charged to that account.


(5) A credit provider may not close or terminate a credit facility solely on the grounds that—
(a) the credit provider has declined a consumer's request to increase the credit limit;
(b) the consumer has declined the credit provider's offer to increase the credit limit;
(c) the consumer has requested a reduction in the credit limit, unless that reduction would reduce the credit limit to a level at which the credit provider does not customarily offer or establish credit facilities; or
(d) the card, personal identification code or number or other identification device used to access that facility has expired.


(6) The unilateral termination of a credit agreement by a credit provider as contemplated in this section does not suspend or terminate any residual obligations of the credit provider to the consumer under that agreement or this Act.