Lending to a Friend or Relative – When Must You Register as a Credit Provider?

KVV Inc Attorneys

Published on: 04/03/2025

Lending money to friends or family can be risky. While it seems natural, if the loan isn't "at arm's length" (a formal business arrangement) it may not fall under the National Credit Act (NCA). A recent case highlighted this, where a R15m informal loan between friends was deemed outside the NCA, saving the lender. However, relying on informal agreements is dangerous.