Debt review in South Africa: what it means and how it works

Debt stress often builds slowly. At first, it may feel manageable. But without a solid system, payments can easily accumulate and start to take up more of your monthly income. Before long, your money is going out faster than it comes in.

This guide will help you understand your options before you take out another loan or ignore the problem because it feels too big.

We’ll cover:

• How debt review works in South Africa
• How to check whether it may be right for you
• What debt review costs
• How to manage debt on a low income
• What to do if you have no income
• Whether you can get a loan if you’re “blacklisted”
• When debt consolidation may help
• What rights you have under the National Credit Act 

First: which debt situation are you in?

Before we get into the details, here’s a simple way to orient yourself.

If you’re still up to date on payments

Start with your budget. List what comes in, what goes out, and which payments are starting to put pressure on the rest of your life.

What to do next: Speak to your creditors early, avoid taking on new credit, and use a budget worksheet to see where you can free up money before the situation gets harder.

You can download our simple budgeting workbook here to get started:

If you have several debts but can still qualify for affordable credit

Debt consolidation may be worth exploring, but only if it lowers the total cost or makes repayment easier without creating new debt.

What to do next: Compare the new monthly repayment, interest rate, fees, loan term and total amount repayable before signing anything.

If you can’t keep up with your current repayments

Debt review may help if you have a regular income, but your repayments are too high.

For example, if you earn R15,000 a month and your debt repayments are R8,500, leaving too little for rent, groceries, electricity and transport, debt review is designed for this kind of situation.

What to do next: Speak to an NCR-registered debt counsellor and ask for an assessment before you commit.

If you’re already under debt review

The goal is to complete the plan and receive your clearance certificate.

What to do next: Keep paying according to the plan, avoid applying for new credit, and ask your debt counsellor what still needs to be paid before clearance.

If you have no income

Debt review may not solve the immediate problem because it relies on you being able to make some form of repayment.

What to do next: Look for support through government social relief programmes, community organisations, local advice offices, legal aid resources or a social worker before committing to a repayment plan you cannot afford.

What is debt review or debt counselling?

Debt review, also called debt counselling, is a formal process under the National Credit Act. It helps people who can’t keep up with their debt repayments restructure what they owe through a registered debt counsellor.

You may also see the term “over-indebted” in official documents. In plain language, this means you don’t have enough income left to cover your normal living costs and your debt repayments.

A registered debt counsellor looks at your income, expenses and debts to see whether you qualify. If you do, they’ll help work out a repayment plan you can afford and communicate with your credit providers through the correct legal process.

What debt review is

Debt review is:

• A legal debt relief process
• A way to restructure repayments
• Handled by a registered debt counsellor
• Usually suited to people with regular income who can’t keep up with current repayments
• A way to help you repay existing debt in a more structured way.

What debt review is not

Debt review is not:

• A quick fix
• A debt write-off
• A way to get more credit
• The right option for every debt problem
• A solution if you have no money available for any repayment

What to do next: Before applying, check that the debt counsellor is registered with the NCR and ask them to explain the full process, fees, timelines and impact on your credit profile.

How does the debt review process work?

Step 1: You apply through a registered debt counsellor

You give the debt counsellor details about your income, expenses, debts and monthly commitments.

Action: Prepare your payslip or proof of income, bank statements, account statements, loan balances and a list of monthly expenses.

Step 2: Your credit providers are notified

When you apply, your credit providers and credit bureaux are notified through the correct process.

Action: Ask the debt counsellor what forms will be submitted, when they will be submitted, and what this means for your credit profile.

Step 3: Your debt is assessed

The debt counsellor checks whether your income is enough to cover your living costs and your debt repayments.

For example, if you take home R42,000 and your minimum debt repayments are R24,000, the counsellor will look at whether the remaining R18,000 can realistically cover rent, food, transport, electricity, school costs and other essentials. 

Action: Be honest about your real expenses. If you leave out transport, food, school costs or informal loans, the repayment plan may fail later.

Step 4: A new repayment proposal is created

If you qualify, the debt counsellor works out a repayment plan based on what you can afford.

Action: Ask to see the proposed monthly repayment and check whether it leaves enough for essentials.

Step 5: Creditors are engaged

The debt counsellor communicates with your credit providers and proposes a rearranged repayment plan.

This may include lower monthly instalments, longer repayment periods or a structured plan across multiple accounts.

Action: Keep all communication from creditors and send it to your debt counsellor, especially if you receive legal letters or payment demands.

Step 6: You repay according to the plan

You make payments according to the agreed structure. The debt counsellor monitors the process until the debts are paid up.

Action: Set a payment reminder and treat the repayment like a non-negotiable monthly commitment. Missing payments can put the arrangement at risk.

Step 7: You receive a clearance certificate

Once you meet the requirements, a clearance certificate can be issued. This confirms that you have completed the required obligations under the debt rearrangement order.

Action: Before your final payments, ask your debt counsellor what documents are needed for clearance and how long the process usually takes.

What does debt review cost?

Debt review is not free, but fees charged by registered debt counsellors are regulated.

The NCR fee guideline includes:

• An application fee
• A possible rejection fee if the application is rejected
• A restructuring fee if the application is accepted
• Monthly after-care fees
• Legal fees in certain cases
• Possible payment distribution fees

As a guide, the NCR lists a R50 application fee, a R300 rejection fee excluding VAT, and a restructuring fee capped at R6,000 excluding VAT. Monthly after-care fees and legal fees may also apply.

These fees should be explained to you before you sign. They are usually built into the debt review process rather than paid as a surprise extra, but you should still ask exactly what you’ll pay and when.

What to do next: Ask the debt counsellor for a written fee breakdown before you apply. If anything feels unclear, check the NCR’s latest guidance or contact the NCR directly.

Is debt review right for me?

Wherever you are financially, this is not a test you pass or fail. It’s just a way to check which option fits your situation best.

Debt review may be right for you if:

• You have regular income
• You’re missing payments or close to missing payments
• Your debt repayments leave too little for essentials
• You’re borrowing from one lender to pay another
• Creditors are contacting you about arrears
• You need one structured repayment plan
• You want help communicating with credit providers

Debt review may not be right for you if:

• Your debt is still manageable with budgeting changes
• You only need short-term breathing room
• You want to take out more credit soon
• You don’t have enough income to make any repayment
• The issue is one isolated account rather than your full debt situation
• You have no income and need social or income support first

The biggest trade-off is access to credit. Debt review is designed to help you repay existing debt, not take on more. While the process is active, you generally cannot access new credit until the process is completed and you receive clearance.

What to do next: ask yourself, “Can I realistically keep paying my debts as they are for the next three months?” If the answer is no, it may be time to speak to a registered debt counsellor.

How do I get out of debt on a low income?

Getting out of debt on a low income starts with understanding what you owe, what you can afford, and which option fits your situation.

Start with these steps:

1. List every debt, including loans, store cards, credit cards, arrears and informal debt.
2. Write down the balance, monthly repayment and interest rate if you know it.
3. Separate essential expenses from non-essential spending.
4. Avoid taking on new credit while you’re trying to fix the problem.
5. Contact creditors early if you’re falling behind.
6. Speak to an NCR-registered debt counsellor if your repayments are no longer affordable.

The most important question isn’t only, “How much do I owe?”

It’s also, “What can I realistically pay every month without falling behind again?”

For example, if you earn R9,000 and can only safely pay R1,500 towards debt after rent, food, transport and electricity, don’t agree to a R3,000 repayment just to stop the calls. A repayment plan only works if you can keep paying it.

Debt review can help some people, but low income doesn’t automatically mean it’s the right answer. It usually works best when you have regular income, but your current repayments are too high.

If you have no income or no money available for repayment, start with support that helps you stabilise your situation first. This could include government social relief programmes, community organisations, local advice offices, food support, legal aid resources or referral to a social worker.

What to do next: Write down your real monthly income and essential expenses. The amount left over is the starting point for any debt plan.

Can I get a loan if I’m “blacklisted”?

The first thing to know is that “blacklisted” isn’t always the most accurate term. In South Africa, people often use the term to mean they have negative information on their credit profile. That could include missed payments, arrears, defaults, judgments or a debt review flag.

So, can you get a loan with a poor credit record? Sometimes, yes. But it’s usually harder, more expensive and riskier.

Here’s what often happens:

• The lender may offer a smaller loan
• The interest rate may be higher
• The repayment term may be less favourable
• The total cost may be much higher than expected
• The loan may only give short-term relief before creating a bigger problem

For example, a R2,000 loan may look helpful if you need to cover an urgent bill. But if the fees and interest mean you now owe much more next month, it can push you further behind.

Be careful of lenders advertising:

• “blacklisted loans”
• “guaranteed approval”
• “no checks”
• “instant loans for bad credit”

These offers can sound helpful when you’re under pressure, but they may come with high costs or risky terms.

The real question is not only, “Can I get approved?”

It’s, “Will this loan leave me in a better position next month?”

If you’re already struggling to afford your current repayments, more credit may give you short-term relief but leave you worse off later.

What to do next: Before taking a loan, write down the full repayment amount, fees, interest, due date and what you’ll have left for essentials. If the loan only delays the same problem, look at debt advice instead.

Can I get credit while under debt review?

No, not while the process is active.

Debt review is there to help you repay debt, not add new debt. While you’re under debt review, access to new credit is restricted until you complete the process and receive clearance.

This can feel limiting, but it's also part of the protection. The point is to stop the debt cycle while you work through the plan.

What to do next: If you’re under debt review and need money for an emergency, speak to your debt counsellor before taking any action. Don’t apply for credit without understanding the consequences.

What is debt consolidation?

Debt consolidation means combining multiple debts into one loan or repayment facility. Instead of paying several accounts, you make one payment.

This can be useful, but only in the right situation.

Debt consolidation may help if:

• The new interest rate is lower
• The monthly repayment is affordable
• The total cost of credit doesn’t increase too much
• You stop using the old credit facilities
• You’re not already unable to keep up with repayments

Debt consolidation may make things worse if:

• You use it to clear cards, then spend on them again
• The loan term is much longer
• The total cost becomes higher
• You’re already struggling to afford basic expenses
• You use it to delay dealing with a bigger debt problem

For example, if you consolidate R40,000 of debt into one loan and the monthly repayment drops from R4,000 to R2,500, that may feel like relief. But if the new loan runs for much longer, you may pay more overall.

A lower monthly payment is not automatically a better deal. Always check the full cost.

What to do next: Ask the lender for the total amount repayable, not only the monthly instalment.

Debt consolidation vs debt review: what’s the difference?

What to do next: if you can still afford your repayments and qualify for a cheaper loan, compare consolidation options carefully. If you can’t keep up, speak to a registered debt counsellor before taking more credit.

What happens during creditor negotiation?

Creditor negotiation is one of the main reasons people enter debt review.

A debt counsellor looks at what you can afford, prepares a repayment proposal and communicates with your credit providers on your behalf.

This may include:

• More affordable monthly instalments
• Longer repayment periods
• A structured repayment plan
• Payment arrangements across multiple accounts

Just remember, debt review doesn’t automatically write off what you owe. The goal is to rearrange your repayment obligations so they become more manageable and you can make steady progress.

For example, instead of paying five different accounts at different times of the month, you may move into one structured plan based on what you can afford.

What to do next: Ask your debt counsellor to explain which debts are included, what each creditor will receive, and what happens if one creditor does not accept the proposal.

What are my rights under the National Credit Act?

When you’re under a lot of financial pressure, it can feel like everyone else has the power: the bank, the store, the lender, the call centre or the debt collector.

But you do have rights.

You have the right to apply for debt counselling

If you can’t keep up with your debt repayments, you can approach a debt counsellor directly.

Action: Don’t wait until every account is in arrears. Ask for help as soon as your repayments are no longer affordable.

You have the right to use a registered debt counsellor

The NCR keeps a register of debt counsellors, credit providers and credit bureaux.

Action: Check that the person or company you’re dealing with is registered before sharing documents or signing forms.

You have the right to understand the process

Before signing anything, make sure you understand:

• fees
• timelines
• what happens to your credit profile
• what you’ll need to pay each month
• how and when you can exit the process
• what happens if you miss payments

Action: Ask for the explanation in writing. If you feel rushed or pressured, pause before signing.

You have the right to a clearance certificate

Once you meet the requirements, a clearance certificate can be issued.

Action: When you’re close to the end of your plan, ask your debt counsellor what steps are needed to finalise clearance.

How to choose the right debt solution

The right option depends on where you are now.

If you’re still up to date on payments

Start with your budget. Stick to your budget, speak to creditors early and avoid taking on more credit.

You can download our simple budgeting workbook to help you get started:

If you have several debts but still qualify for affordable credit

Debt consolidation may be worth exploring.

Compare:

• the interest rate
• monthly repayment
• fees
• loan term
• total amount repayable

Don’t only compare the monthly instalment.

If you’re already struggling to keep up

Speak to an NCR-registered debt counsellor about debt review. You don’t have to commit immediately, but you can find out whether you qualify and what the process would involve.

If you’re already under debt review

Focus on completing the plan and getting your clearance certificate. Don’t apply for more credit while the process is active.

If you have no income

Debt review may not solve the immediate problem. You may need income support, food support, community help, legal guidance, creditor-specific arrangements or a referral to a social worker first.

 FAQs

How do I get out of debt on a low income?

Start by listing every debt, cutting non-essential spending where possible, and working out what you can realistically pay each month. If your repayments are no longer affordable, speak to an NCR-registered debt counsellor.

What is debt review?

Debt review is a legal process that helps people who can’t keep up with repayments restructure their debt through a registered debt counsellor.

Is debt counselling the same as debt review?

Debt counselling is the support provided by a registered debt counsellor. Debt review is the formal process used to assess and restructure debt.

What does debt review cost?

Debt review fees are regulated. Ask for a written breakdown of application, restructuring, after-care, legal and payment distribution fees before you sign.

Can I get a loan if I’m “blacklisted”?

Sometimes, but it's usually more expensive and risky. If the loan only helps for one month but makes next month harder, it may worsen the problem.

Can I get credit while under debt review?

No. While debt review is active, you generally cannot take on new credit until you complete the process and receive clearance.

What is debt consolidation?

Debt consolidation combines multiple debts into one loan or repayment. It can help if it lowers your cost, but it can make things worse if you keep using credit.

Is debt consolidation better than debt review?

It depends on your situation. Consolidation may suit people who still qualify for affordable credit, while debt review is for people who can’t keep up with repayments and need formal restructuring.

What rights do I have under the National Credit Act?

You have the right to apply for debt counselling, use a registered debt counsellor, understand the fees and process, and receive a clearance certificate once you qualify.

‍