A staggering 10 million South Africans who use credit are finding it difficult to keep up with their debt repayments.
If you are among them, you are likely familiar with the relentless emails, calls, letters, and SMS reminders demanding immediate payment.
But what if a creditor is still hounding you over debt you can barely remember, or you see an old, unpaid account on your credit report?
Did you know that ” the really old debt” could be prescribed debt, and it’s important to know that it’s unlawful for creditors to demand payment on prescribed debt.
So, what exactly is prescribed debt, how does it work, and what are your rights as a consumer? Let’s explore everything you need to know.
Simply click on any topic in the table of contents below to get started.
Table of Contents
What types of Debt is written off?
How to Check If Your Debt Has Been Prescribed
Prescribed Debt and Debt Collection Laws in South Africa
Your Rights Against Debt Collectors
What is Prescribed Debt in South Africa?
Prescribed debt refers to debts that have passed a certain time limit, after which the borrower is no longer legally required to pay the debt amount owed.
Under the Prescription Act 68 of 1969, a debt becomes prescribed if the following conditions have been met for three years:
- You have not acknowledged the debt, either verbally or in writing.
- No payments have been made towards the debt.
- No summons have been issued or delivered to you regarding the debt.
It’s Important to Note: Credit providers won’t notify you when your debt becomes prescribed. Whether your debt qualifies depends on the type, how much time has passed, and what actions were taken by the creditor during the prescribed period.
What Type of Debt is Written Off
Most consumer debt falls under contractual credit agreements, including:
- Store accounts
- Credit card accounts
- Personal loans
- Gym memberships
- Cell phone contracts
- School Fees
If you haven’t made any payments or acknowledgments for more than a period of three years, and there has been no attempt by the credit provider to collect or take legal action, they lose the right to demand payment.
Which Debt has a longer prescription time period?
- Home loans: Debts regarding your home loan are prescribed after 30 years.
- SARS: Any money owed to the South African Revenue Service (SARS) also has a 30-year prescription period.
- Municipal rates and taxes: Rates and taxes owed to your municipality are prescribed after 30 years.
- TV licences: Debts related to unpaid TV licences are prescribed after 30 years as well.
These debts fall under the longer prescription period as outlined in the Prescription Act 68 of 1969.
How to Check If Your Debt Has Been Prescribed
If you think a debt has been prescribed, you can file a dispute with the relevant credit bureau.
- Request a dispute reference number to track your case.
- The credit bureau is required to investigate and respond within 20 business days.
- If you don’t receive a response within the 20-day window or are unhappy with the outcome, you can escalate the issue to the Credit Ombud for any further assistance.
Prescribed Debt and Debt Collection Laws in South Africa
How Do Creditors Prevent Debt from Being Prescribed?
The Prescription Act ensures fairness for both consumers and creditors. While letting debt lie dormant might seem tempting, it can lead to more harm than good.
Creditors have the right to interrupt and extend the prescribed period. They do this by:
- Sending payment reminders
- Contacting you via email, SMS, or calls
- Taking legal action to prevent the debt from prescribing
Your debt is NOT prescribed if you’ve made any acknowledgment of the debt or any payment within the prescribed period.
- The debt remains valid and you are still responsible for paying it.
- In such cases, it’s in your best interest to negotiate a repayment plan with the creditor to settle the outstanding amount.
Your Rights Against Debt Collectors
In March 2015, a new law regarding the prescription of debt came into effect. This law specifies that any debt that has been prescribed under a credit agreement can no longer be pursued by either the creditor or a debt collector.
- The debt cannot be sold to another party for collection.
- Before 2015, it was the responsibility of the consumer or debtor to invoke prescription as a defence if a creditor attempted to collect on an old debt.
- If the debtor failed to raise this defence, they would still be liable for the full amount, along with any additional interest and costs associated with the debt.
This change was a significant shift in protecting consumers from being pursued for debts that had legally expired.
Section 126B of the NCA and Prescription states:
(1)(a) No person may sell a debt under a credit agreement to which this Act applies and that has been extinguished by prescription under the Prescription Act, 1969 (Act 68 of 1969).
(b) No person may continue the collection of, or re-activate a debt under a credit agreement to which this Act applies-
(i) which debt has been extinguished by prescription under the Prescription Act, 1969 (Act 68 of 1969); and
(ii) where the consumer raises the defence of prescription, or would reasonably have raised the defence of prescription had the consumer been aware of such a defence, in response to a demand, whether as part of legal proceedings or otherwise.
How do you Raise Prescription as a Defence?
Debt collectors often use tactics to pressure consumers into paying, even when the debt is prescribed. This is called “interrupting prescription.”
If you believe a debt is prescribed and a debt collector is demanding payment, you can raise the prescription as a defence. Refuse to make any payments until they provide evidence that the debt is still active. Always document your communication using emails or letters, and ask them to provide:
- The original loan agreement
- Proof of default
- The outstanding balance
- Total interest and costs incurred
- Evidence of attempts to contact you within the prescribed period
Take the First Step Toward Financial Relief
Don’t wait until your financial situation becomes unmanageable. The sooner you reach out to us, the sooner we can protect you from legal action and give you the financial relief you need.
If you’re feeling overwhelmed by debt, know that we’re here to help you every step of the way.
Contact us Today for your Free Debt Assessment
I am self employed can I still go under debt review
Hi Johan
Yes, you can. To qualify for debt review you’ll need to be employed and have at least R40,000. As long as you’re earning an income you’ll qualify.
Please provide us with your contact information. One of our friendly consultants will get back to you as soon as possible. They will answer any question you may have.
Does debt review interrupt prescription or does it not?
Debt review and debt prescription are two different debt solutions. Please leave your details below and one of our friendly consultants will contact you and answer any questions you may have.
Iam under dept review and two of my account are predcribed while in dept review process.ist a must to settle them or i can qualify for settlement letter without paying thd outstanding amount under prescribed dept?
Hi Terrence
Settle all your debt as soon as possible.
Hello.
I went under debt review 2 years after my accounts were in arrears there are no judgements or defaults on my credit record. It has now been the 3rd year that I have defaulted with my debt counselor due to non payment and the Statutory of consent shows on my profile. The account has already prescribed. Can I follow the prescription process and exit debt review after this has been done? I haven’t made any promise to pay or acknowledgment
Hi John
It would be best to discuss this with your debt counsellor directly.
Hi…I applied for debt review in February 2014 nd cacelled april 2014, there was no payment made by then..Some of my debt were prescribed nd some have been paid off but there is still 1 clothes account that i just recovered was not paid nd it has been handed to lawyers. The account was for 2012 2013 so am not sure if this account should be prescribed. If i want to check the acc is prescribed where do i go.the debt review still appears on my credit profile
Hi Mapitsi
Contact your debt counsellor to assist you with this matter.
Hi. Please advise my situation.
My account at FNB is in overdraft – minus R20 000.
My credit card is maxed out – minus R60 000.
Personal Loan – debt minus R60 000.
Revolving Loan – debt minus R50 000.
Covid Relief Loan – debt minus R40 000.
I have minimal income right now and since lockdown started 2 years ago I could not work.
I am a coach that trains kids and work for myself.
My debt is so much I would never ever be able to repay it.
I can’t work now either and 90% of kids stopped training due to covid and lock downs.
I make R3000 – R5000 per month. (from this I need to live buy food)
I literally can’t afford to pay any of these loans as I barely have money for food to survive.
I have no car. I have no house. I have no property or anything of value.
I have nothing but the clothes I am wearing.
This is an impossible situation.
And I am scared to death and stressed out about the weird numbers calling me.
What do I do?
Hi Lara
We’re very sorry to hear about your situation, it can’t be easy. Please use our online calculator to see how much you can save per month by applying for debt review – follow this link to the online calculator https://bit.ly/36L94Se. This process has helped thousands of people in the same position as you. Alternatively, leave your contact details in the field below and one of our friendly consultants will contact you shortly.
Please let us know if you have any other questions.
How do I check if an account has been prescribed. I have an account that’s showing on my credit bureau profile apparently I took a payday loan in July 2018 that has never been debited and I have never changed my banking details. What do I do with this debt?
how do i remove a red flag. i cancelled my debt review years ago but its still red flagged. plz help.
Hi Ruth
Please contact your creditor to assist you with this issue
Hi Alan
Please contact your debt counsellor to assist you with this
Good day,
Kindly advise.
I have two loan accounts that go back 6 and 8 years. They are both loan account. Does this
count as prescribed debt.
Hi Jillian
Please contact us and one of our consultants will help you with your query more accurately
What happens if you have prescribed debt if you under debt review and have not paid for 5 years
Hi Gito
Please contact us asap. One of our consultants will address your query and help you find the best solution.
i have a few loans out mostly taken out in 2018 and i have made erratic payments over they years but they are all behind in payments. do they still qualify to be prescribed as its now 2022 and ideally i would like them to be written off.
Why is it that my credit report is written adverse code written off and what does it mean
I have a large amount in unpaid levy arrears accumulated since 2008. The amount now is R44892,77 including interest to Feb 2022 owing the Body Corporate (BC). In 2014 when the arrear was R14695 a Judgement order was granted against me but the BC has not furthered any processes. Accordingly the Attorney’s fees on reaching judgement was R4761 in 2014 rising to R13054 now @ 15.5% interest. The BC is now claiming R57947 in full settlement of my levy account as I contemplate selling the unit. Do I qualify for prescription on any part of this debt?
Regards
Kesi
So what happens if you have a mortgage bond and you have other debts like a personal loan but cant afford to pay the personal loan, but I can pay my mortgage bond only. Can they take my house or do something to add the debts to my mortgage loan?
I have a prescribed student loan and my other account telkom account states that I’m deceased will I qualify for any loan??
Good day, Kindly note that you will need to clear your ITC to be approved for a loan.
Good day Rudi, best would be to get in contact with one of our consultants to assist you with answering your questions. Please feel free to leave your contact number and we will contact you as soon as possible.
Good day Kesi, thank you for reaching out to us. Please note that service agreements does not prescribe and if a judgment was issued this will reflect against your name for 30 years or until you settle the account. Best would be to reach an agreement with the provider and stick to your agreement to get this removed from your name.
Good day Tumelo, this might mean that the debt has been written off, best would be to contact the provider that listed you and request that they remove the listing from your name. Alternatively you can do a ITC clearance.
Good day Russell, please note that this debt will not be prescribed if you made any payment to this account in the last 3 years. Best would be to rather make arrangements with the credit providers to get this debt settled to avoid Judgements against your name. Alternatively you can make contact with our offices on 0861 123 644 and one of our friendly consultants will help you with advise and possible solutions.
Good evening
I went under debt review in 2016 however my debt counselor closed down in 2017 🤦♂️. I only had one account that has been prescribed and transunion has removed it off my profile, however it still shows that I’m under debt review, I’ve contacted the NCR but got no response. Is there any way that you can assist me with this matter.
I have the letter from TransUnion saying its prescribed and removed from my profile.
Please contact me if you can assist, I live in the Edenvale area.
Good day Lucas, kindly make contact with our offices on 0861 123 644 or info@debtrescue.co.za and one of our friendly consultants will assist.
Good day
I dropped out of tertiary in 2016 because I couldn’t afford to pay the fees, Las week I received a summons statement I must pay outstanding fees. What should I do?
Thank you
Good day Siya, the best advise we can give would be to contact the attorneys that handles the matter and reach an agreement to repay the debt you have.
Hi there, Thanks for the article. I have received a Municipal Bill that states that I owe them R9k for rates that they did not charge me from Feb 2017 to January 2018. Today is 9 June 2022. The Municipality says their system failed and did not charge me the rates but now the system has suddenly remembered hence the large amount owing. IS this Municipal Rates debt now prescribed and can I approach the municipality saying that the debt is prescribed and that they cant demand it?
Good day, thank you for your feedback. Unfortunately municipal debt cant not be prescribed therefor you will have to contact them and reach an agreement to pay the money owed to them. Alternatively you can appoint an attorney to negotiate on your behalf.
Hi I have a nimble on my credit report trying to collect debt from 2018 i need this removed please assist
Good day, please contact Nimble to assist with this request.
[…] as explained by Debt Rescue here, the credit provider has made no effort to secure payment, communicate with the client, or […]
Good Day
I need legal advise, i last made payment on 20 December 2020 for Edgars clothing store, how can i file prescription as now they have sent letter of demand s19
Good day, please make contact with us on 0861 123 644 or info@debtrescue.co.za and a friendly consultant will give you a call.
Allen, If your debt is prescribed and you ask for the prescribtion letters and the company does not reply, what must you do? AND is there a timeframe for them to send you the prescribtion letters? Can debt review be removed without this prescribtion letters if the companies don’t reply or send you the prescribtion letters?
I mean certainly there must be timeframes involved?
I have 4 account in arrears:
1. Vodacom
2. Vodacom
3. VW Vehicle
4. Investec Vehicles
I am currently paying for the first three (the Vodacoms and VW Vehecles. They were handed over to attorenys)
The Investec Vehicles I have not paid. The last communication with the creditor was in March 2022
If i dont communicate with creditor in the next two years will i qualify for prescription in March 2025?
Please advise
Good day Siyethamba, unfortunately this is not how it works as long as the credit provider can proof that they have been trying to remain in contact with you (regardless whether you change your contact information), you will remain liable for the debt. As it is your responsibility to FICA if you change contact numbers, email address and residential address.
Debt Review is acknowledgment that you know you have the debt, should a credit provider not supply a prescription letter, you will remain liable for the debt.
I logged into my clearscore account and out of the blue it says I have 2 new accounts. 2 Credit cards with account numbers by a debt collection company called DMC5.
I get disability grant and never applied for any cedit. Nor can I afdord it.
I went to their website to report fraud and had to log in with my ID number in order to get support, and then saw accounts, with amounts to be paid in my “so called accout” under my ID number.
The staff member who I talked to via a website based chat program, kept telling me they have to investigate this to either prescribe the debt or have it prescribed. He never answered my question why they created 2 credit cards. I kept telling him I dont owe anyone and fraud was committed. But he was oblivious to this.
What can I do about this?
They illegally opened 2 credit cards in my name.
They have my personal info and are claiming money I dont owe.
Who should I contact? What must I do?
Please help me?
Best would be to go to the police station and make an affidavit stating that fraud was committed on your ID number and supply DMCS and the bank that the credit cards was opened with, with the affidavit. This is a very long investigation process but safe guard yourself in the meantime and get the affidavit.