RESPONSIBLE LENDING POLICY

APPLICATION

This policy is in respect of the principles of all lending to client/s of Fincorp Solutions (Pty) Ltd Reg No 2002/004025/07 (Hereafter referred to in this document as “Fincorp”) This policy is designed to satisfy the requirements of the National Credit Regulator and the National Credit Act 34 of 2005 (NCA), including the Affordability Assessment Regulations and the prevention of reckless lending.

PURPOSE

This manual establishes the policies and procedures for responsible lending practices in accordance with the National Credit Act, 34 of 2005, associated Regulations, and all directives issued by the National Credit Regulator. The objectives are to:

  • Prevent reckless lending.

  • Ensure affordability assessments are conducted.

  • Protect consumers from over-indebtedness.

  • Promote fair and transparent lending.

  • Maintain regulatory compliance.

RESPONSIBLE LENDING PRINCIPLES

Fincorp shall:

  • Act honestly and fairly.

  • Treat consumers equitably.

  • Conduct affordability assessments.

  • Verify income and expenses.

  • Consider debt repayment history.

  • Prevent over-indebtedness.

  • Maintain confidentiality.

  • Provide clear disclosures.

GOVERNANCE

Management shall:

  • Approve lending policies.

  • Monitor compliance.

  • Review lending outcomes.

  • Report material breaches.

Staff are accountable for compliance with this policy.

CUSTOMER IDENTIFICATION

Prior to granting credit:

  • Verify identity.

  • Obtain proof of residence.

  • Verify income.

  • Conduct fraud prevention checks.

  • Maintain customer records.

AFFORDABILITY ASSESSMENT

No credit may be granted unless affordability has been assessed.

Income Verification

Acceptable documents:

  • Payslips.

  • Bank statements.

  • Employment letters.

  • Business financial statements.

  • Pension statements.

Expense Assessment

Living expenses shall include:

  • Housing.

  • Food.

  • Utilities.

  • Education.

  • Medical expenses.

  • Insurance.

  • Transport.

  • Existing debt obligations.

Minimum expense norms may not be used to underestimate actual expenses.

Debt Obligations

The credit provider shall:

  • Obtain credit bureau reports.

  • Review existing obligations.

  • Verify repayment history.

Disposable Income

Credit shall only be granted where sufficient disposable income exists after meeting existing obligations and reasonable living expenses.

RECKLESS LENDING PREVENTION

Credit shall not be granted where:

  • Affordability has not been assessed.

  • Consumer information has not been verified.

  • Consumer does not understand obligations.

  • Consumer cannot afford repayments.

  • Credit would result in over-indebtedness.

DISCLOSURE REQUIREMENTS

Consumers shall receive:

  • Quotations.

  • Pre-agreement statements.

  • Interest rates.

  • Fees.

  • Repayment schedules.

  • Total cost of credit.

  • Default implications.