Over the years we have received many calls from consumers asking "What is debt review?". In this article, I will do my best to answer the question.
Debt review is a legal process for South Africa consumers who struggle to, or cannot meet their monthly debt repayments. It comes from the National Credit Act of 2007 and is run by NCR registered debt counsellors. The aim is simple: give you a structured plan to repay debt in an affordable way while protecting you from legal action.
You qualify if you are over-indebted. That means your reasonable living costs plus minimum debt payments are more than your net income. You must also have income that can fund a repayment plan. People with no income do not fit the process, and business debt is outside its scope.
Assessment: A debt counsellor (DC) looks at your payslips, bank statements, expenses, and credit agreements. The counsellor decides if you are over-indebted.
Proposal: The counsellor drafts a new payment plan. It sets a single monthly amount and fair allocations to each creditor. The plan often stretches the repayment term and lowers instalments. Interest rates can drop through negotiation.
Protection period: Once you apply, credit providers must stop legal action while the assessment and proposal run.
Court or Tribunal order: The plan goes to a magistrates’ court or the National Consumer Tribunal. After approval, it becomes binding on all parties.
Single payment: You pay one amount each month to a Payment Distribution Agency. The PDA pays each creditor as per the order.
Completion and clearance: When all debts in the plan are paid, the debt counsellor issues a clearance certificate. Credit bureaus receive it and remove the flag from your profile.
Creditors cannot repossess goods or sue on listed debts if you pay as ordered.
Collection calls stop and all talks go through your counsellor.
Interest and fees may be reduced through negotiated terms.
You gain a clear budget and a set end date.
There are a few limitations, but they are there to help you become debt free. You cannot take on new credit while under review. Missing payments risks cancellation of the plan and renewed legal action. You must keep insurance on financed assets, like a car or homeowners insurance active. You also need to update the counsellor if your income or expenses change.
The fees are highly regulated by the National Credit Regulator. These include an application fee, a once-off restructuring fee, and a monthly after-care fee. A PDA fee also applies. The fees are already included in your monthly restructured payment plan to keep the review affordable.
The duration depends on your debt level, income, and negotiated interest. Many plans run 36 to 60 months. Paying extra shortens the term. Pay on time each month to keep court protection and reach the finish line faster.
Payment arrangement on your own: You can phone creditors yourself and ask for lower instalments. This can work for small arrears, but offers less legal protection and no single court order.
Consolidation loan: One loan can replace many debts. It needs a clean credit record and stable income. Interest may be high, and missed payments place the new loan at risk.
Sequestration: This is formal insolvency. It writes off a portion of debt but can lead to asset sales and strict limits. It suits extreme cases.
Do nothing: Arrears grow, credit providers take legal steps, and assets face repossession. This path is risky and costly.
You skip debit orders to buy groceries or fuel.
You borrow from one lender to pay another.
Credit cards sit near the limit with only minimum payments.
You receive Section 129 letters warning of legal action.
Your stress affects sleep, family, or work.
Pick a counsellor registered with the National Credit Regulator. This is the most important step. If the DC doesn't have a valid NCRDC registration number, RUN!
The second step should be to read reviews about the company. Don't just believe any review you see; Hellopeter has many companies with fake reviews. Look at how many reviews a day the company receives, look at the time between reviews, do your homework. A company with 20 or more reviews a day are probably writing it themselves.
Lastly, get all fees, timelines, and duties in writing.
After you have settled all short-term debts and received a clearance certificate, credit bureaus will remove the “under review” flag from your profile.
We suggest that you work on building a cash buffer equal to one month of expenses. Use debit orders for fixed bills and track your weekly and monthly spending. And most importantly, only apply for new credit when you really need to and can afford it.
Debt review is not a shortcut. It is a structured, lawful path to repay what you owe at a rate you can afford. You gain court protection, have one monthly payment, and a clear path to financial freedom. You accept limitations on new credit and commit to steady payments. For many South Africans, that trade-off brings control, less stress, and a realistic route back to financial health.