How much does debt counselling in SA cost?

As South Africans adjust to living in a country in the midst of a technical recession, the National Credit Regulator (NCR) has urged the public to make use of debt counselling services.

In a statement released on Tuesday (11 September), the regulator called on more South Africans to make use of its registered debt counsellors.

“At times and for many reasons such as recession, change in circumstances and others, consumers find themselves in a debt trap and no longer able to pay their monthly debt repayments. Consumers who are in this situation should not hide, feel despondent or despair,” it said.

“There is a debt relief measure in terms of the National Credit Act (NCA), which could provide relief.”

The regulator, which is an agency of the Department of Trade and Industry, said there are several signs that point to an individual being over-indebted.

These include:

  • A consumer who cannot repay his/her debts on time as agreed with credit providers;
  • Taking out loans in order repay other loans;
  • Using a credit card and/or overdraft facility to pay debts, buy food and other necessities;
  • Skipping payments on some accounts in order to pay others;
  • Starting to receive letters of demand and summonses from credit providers and/or lawyers; and
  • Having judgments granted against them.

“If your income is not enough to pay for all your living expenses and all of your debts, chances are that you could be over-indebted,” said the manager for debt counselling at the NCR, Kedilatile Legodi.

“These are the signs that should immediately prompt one to seek assistance before it is too late. If you are experiencing any of the above signs, you should speak to your credit providers and negotiate for lower monthly repayments. However, if this process does not work, you can approach an NCR registered debt counsellor for assistance,” said Legodi.

Growing problem

According to Neil Roets, CEO of Debt Rescue, a growing number of South Africans are battling to keep their heads above water.

“We see this on a daily basis with clients coming to us to be placed under debt review because they were no longer able to service their debt. Growing numbers of them have had to accept lower wages to avoid being laid off or were facing retrenchment down the road.

“More than half of consumers are three months or more in arrears with their repayments and this figure is expected to keep climbing steadily as South Africans are getting deeper and deeper in debt,” Roets said.

“What is deeply disturbing is the fact that the overwhelming majority of our clients have little or no hope that things will improve anytime soon.”

He added that Debt Rescue and most other debt counselling firms were showing double-digit growth rates because so many more consumers were getting into trouble and were compelled to seek relief by going under debt review.

“That has become pretty much their last resort to hold on to the few possessions that have not as yet been grabbed by predatory debt collectors,” Roets said.


To undergo debt counselling, a consumer must be employed and have an income, which will be used to offer reduced payments to credit providers.

Legodi drew consumers’ attention to several things to note if they are considering debt counselling.

These include:

  • Only make use of NCR registered debt counsellors. Upon registration, the NCR issues the debt counsellor a registration certificate and a window decal (green sticker) as a means of identification to consumers. If they are not visible, please request them from the debt counsellor;
  • Understand the debt counselling process, your rights and obligations prior to applying for debt counselling;
  • If you are married in community of property, you must jointly apply for debt counselling with your partner;
  • All debt counselling applications must be reduced to either a court or consent order;
  • Debt counselling service is not free of charge.

At the end of February, the NCR published its debt counselling fee guidelines for 2018. It should be noted that not every fee is payable in every instance of debt counselling, but should provide a brief outline of the types of cost involved.

You can find a breakdown of these costs detailed below.

Steps Services Amount (excl VAT) By when should it be paid
Application fee Completion and submission of form. R50 Upfront and in full.
Administration fee (new fee) Includes:

  • Consultation with consumer including an explanation of process and fee disclosure;
  • Form 17.1 process
  • Loading consumers on the Debt Help System (DHS)
R300 per debt counselling application. Upfront and in full.
Restructuring fees Include (but not limited to) the following services:

  • Proposal preparation;
  • Loading the plan on the counsellor’s payment profile;
  • Negotiating with credit providers;
  • Submitting the final proposal;
  • Submitting debt counselling documents to the attorney to draft the court application;
  • Updating the DHS;
  • Transferring the consumer;
  • Instructing the attorney to draft court application;
  • Withdrawal by the consumer.
The fee is either equal to the distributable amount (the amount payable to the creditors as per the initial debt re-arrangement plan), or a maximum fee of R8,000– whichever is lesser. This rises to R9,000 for South Africans married in community of property. Payable in Month 1 after drafting and submission of proposals.
Reckless lending fee (new fee) Includes a reckless lending assessment and supplying of reckless spending documents to draft the affidavit on the assessment outcome. R1,500 per debt counselling application. Payable in month 2 after completing the written outcome of the reckless lending assessment.
Aftercare fee Services include the following:

  • Review of the consumer’s current financial situation;
  • Attending to payment queries;
  • Clearance process, including securing the paid-up letters;
  • Withdrawal by consumer;
  • Updating the DHS.
For the entire debt counselling process, the fee is equal to 5% of the distributable amount or a maximum fee of R450 – whichever is the lesser. Payable in every month after month 2 in which aftercare services are rendered.
NCT Submission fee Submission of the NCT application. R500 (excluding the NCT filing fee). Charged and payable in month 2 after completion of the restructuring process.
Attorney fee Includes:

  • Drafting of the court application;
  • Attendance at the court.


To be agreed upon with the attorney and communicated in writing to the consumer. This should be aligned with the consumer’s earnings. Payable to the attorney only after:

  • one or more credit providers have not accepted the payment plan;
  • the attorney has drafted the court application, and
  • the attorney has attended the hearing of the court application.
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