Debt review — formally called debt counselling under the National Credit Act — is one of the most powerful financial rehabilitation tools available to South Africans who are genuinely struggling to meet their debt repayments. It allows an over-indebted consumer to have all their debt restructured into a single, lower monthly payment, with legal protection against repossession and legal action by creditors during the process. Done properly, with a competent registered debt counsellor, it provides a structured path out of a debt spiral. Done poorly, or with an unregistered or negligent practitioner, it can make your situation worse.
This guide explains who qualifies for debt review, how the process works, what a legitimate debt counsellor does, how to verify credentials, and the questions to ask before you commit to the process.
Who Qualifies for Debt Review
Debt review is available to any natural person (not a company or trust) who is "over-indebted" under the definition in the National Credit Act. Over-indebtedness means that your monthly income, after basic living expenses, is not sufficient to meet all your monthly debt repayments as they fall due.
You do not need to be in arrears to apply for debt review — you can apply when you can see that your income will not cover all obligations in the near future. However, you must be able to afford the restructured payment that a debt counsellor proposes. If your income is so low that even a restructured payment is unaffordable, debt review may not be the right solution and sequestration (bankruptcy) may need to be considered instead.
Note: debt review is not available to someone who is already subject to an administration order (a separate debt management process through the Magistrate's Court) or who has been sequestrated. It also cannot include business debts — only personal (consumer) credit agreements.
What the Debt Review Process Actually Involves
Understanding the process before you commit prevents surprises. The sequence is as follows.
The debt counsellor assesses your income, expenses, and all credit agreements. They determine whether you are over-indebted and what a realistic monthly consolidated payment looks like. This assessment should be thorough — it covers every credit agreement: home loan, car finance, personal loans, credit cards, store accounts, and micro-loans.
Once accepted, the debt counsellor sends a 17.1 notification to all your credit providers and the credit bureaux, indicating that you have applied for debt review. From this point, your credit profile reflects "under debt review." You cannot take out new credit during the process.
The debt counsellor proposes a restructured payment plan to all credit providers. Creditors either accept or reject the proposal. If they accept, the plan proceeds through consent. If any creditor rejects, the matter goes to the Magistrate's Court for a ruling.
You make one consolidated monthly payment through a registered Payment Distribution Agency (PDA), which distributes the funds to each creditor. Once all debts (except a home loan, which can remain) are settled, the debt counsellor issues a clearance certificate (Form 19), your credit profile is updated to reflect "debt review clearance," and you exit the process.
How to Verify a Debt Counsellor's Registration
The NCR maintains a public register of all registered debt counsellors at ncr.org.za. Verification takes two minutes. Enter the counsellor's name or NCR registration number (which starts with "NCRDC") and confirm that the registration is active. An inactive, suspended, or cancelled registration means the person cannot legally practise as a debt counsellor.
Registration is necessary but not sufficient on its own. Ask how many active debt review cases the counsellor currently manages. A large portfolio (hundreds of clients) managed by a single person often means inadequate attention to individual files, missed court applications, and poor communication. Understand who will actually be managing your file day-to-day and how they can be contacted.
Ask whether the counsellor is a member of a debt counselling association such as the Debt Counsellors Association of South Africa (DCASA) or the National Debt Counsellors Association (NDCA). Association membership indicates a commitment to professional standards and provides an additional complaints channel if needed.
Questions to Ask Before You Commit
Before signing any debt review application, ask these questions and get the answers in writing.
"What is the total monthly payment under the restructured plan, and what does it include?" You need a specific figure — not a range — before you can assess whether debt review is viable for your budget. The payment includes your restructured debt repayments plus the debt counsellor's monthly fee and the PDA's distribution fee.
"Which PDA will handle my payments, and how do I verify my payment history directly with them?" You should be able to see your payment history through the PDA portal independently of the counsellor.
"How long will the debt review process take?" The timeline depends on the total amount of debt and the restructured payment level — typically 3–7 years for most consumer debt portfolios. Understand the realistic timeline before starting.
"When will you apply to the Magistrate's Court for the court order?" The court order is what gives you legal protection against creditor action. It should be applied for within 60 days of the 17.1 being issued. If it is not, creditors can still take legal action against you.
"What happens to my home loan and vehicle finance?" These are typically restructured differently from unsecured debt — often at a longer repayment term to reduce the monthly payment, but retaining the asset. If you are behind on your home loan, the debt counsellor must move quickly to prevent foreclosure proceedings, which run on a different timeline from the debt review process.
The Fee Structure — What You Should Pay
The NCR regulates debt counsellor fees. The main fee components are: a restructuring fee (typically one month's restructured payment, capped by NCR guidelines), a monthly aftercare fee (capped at 5% of the monthly payment or R450, whichever is less for the first year; lower thereafter), and the PDA fee (approximately R175/month for distributing payments to creditors).
All fees are deducted from your monthly consolidated payment — you do not pay separately. Any debt counsellor who requests additional fees outside this structure, or asks for a large upfront lump sum before the restructured plan is in place, is deviating from NCR guidelines and should be reported.
Quick Checklist Before You Apply
- Verify NCR registration at ncr.org.za and confirm active status (NCRDC number)
- Ask for the specific monthly consolidated payment amount before signing anything
- Confirm which registered PDA will handle your payments and how to access your payment history directly
- Ask for the timeline to court application after the 17.1 is issued — should be within 60 days
- Get the complete fee breakdown in writing — all fees should come from within your monthly payment, not as additional charges
- Understand the impact on your home loan and vehicle finance before starting
- Ask about the realistic total duration of the process given your total debt level
- Check association membership — DCASA or NDCA membership adds accountability
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