Canada    FinTech Guide    Chapter 7    South Africa

7. Loan Services / Factoring / Loan Broking / Finetrading
South Africa  South Africa

The average South African does not focus on investments and savings, they are deeply indebted and continue with extravagant expenditure. The financial sphere is under pressure and the economic growth is slow. There are too many of these services for a poor country e.g. loans are granted much faster than debt is paid; more South Africans have access to the market with the dawn of a democratic era; brokerages suffer loss of business as consumers do not save or invest etc.

Legal Affairs

The broker or credit provider in this instance must be registered with the National Credit Regulator (NCR) as a credit provider. A registration fee is payable and annual renewal fees as well. The annual renewal fees are calculated upon the principal debt of the credit provider and the higher the debt, the higher the renewal fee. The National Credit Act 34/2005 regulates the industry. It is argued that any lender in a peer to peer network also needs to register.

Economic Conditions

This is unknown but the amount of peer to peer lending that took place in 2015 is said to be $13.8 million.


Fintech in South Africa is not as developed as in countries with good & stable economic growth. It has been reported that household debt as a percentage of nominal disposable income edged higher from 71.8% in the third quarter of 2018 to 72.7% in the fourth quarter.

With high competition between providers of the mentioned services, low growth and less consumers, there is not much capital to spend on development of Fintech. Loss/gain of employment must also be taken into account.

Contributing Authors

Garlicke & Bousfield Inc

Brian Jennings
Durban, South Africa

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Chapter Index:

1. Payment Services / Mobile Payment

2. Asset and Portfolio Management

3. Consulting and Broking Services / Robo-advisory / Auto-trading

4. Trading Platforms / Social Trading Platforms / Signal Following

5. Crowdfunding / Crowdinvesting / Crowdlending

6. Virtual Currency - Bitcoin

7. Loan Services / Factoring / Loan Broking / Finetrading

8. Online Banking Services

9. Analytics and Research / Data Management / Risk Management

10. Accounting

11. Identification

12. Online-pawning

13. InsurTech

14. RegTech

15. Initial Coin Offerings (ICOs)

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

Publication Date: 1 August 2019