Dear Industry Stakeholder
In terms of Section 14 of the National Credit Act, 2005 (NCA), the National Credit Regulator (NCR) is responsible for regulating the consumer credit industry in South Africa. According to Section 69 of the NCA, the Minister of Trade and Industry may require the NCR to establish and maintain, in the prescribed manner and form, a single national register of outstanding credit agreements.
With the promulgation of the Financial Sector Regulation Act, 2017 (FSRA) in August 2017, the South African Reserve Bank’s (SARB) mandate was expanded to include an explicit financial stability responsibility. The SARB is responsible for protecting and enhancing financial stability by monitoring the global and domestic environment for risks and vulnerabilities and mitigating them through macro-prudential policy action.
This responsibility requires the SARB to, among other things, increase its focus on credit risk by expanding its database with more granular credit data and improving credit information reporting systems. At the same time, more granular credit data will serve the SARB’s price stability mandate and promote more prudent risk-management practices and enhance prudential supervision by the Prudential Authority (PA).
In light of this, in July 2019, Governor Lesetja Kganyago recommended to the Department of Trade, Industry and Competition (DTIC) Minister Ebrahim Patel to establish a central credit register (CCR) for South Africa. In September 2019, Minister Patel agreed and requested the NCR to cooperate with the SARB and other stakeholders to create and maintain a national register of credit agreements for South Africa, as considered in section 69 of the NCA.
Consequently, a CCR Steering Committee (Committee) was set up in December 2019 to drive the establishment of a CCR for South Africa. Members of the Committee include the National Credit Regulator, South African Reserve Bank, Prudential Authority, Financial Sector Conduct Authority, Financial Intelligence Centre, the National Treasury and the Department of Trade, Industry and Competition. Work has been ongoing, and it is envisaged that the financial sector industry will be engaged for discussion and consultations in the first quarter of 2021.
More detailed communication will follow in due course.