How debt review works
How does debt review work in South Africa?
By DebtReviewZA editorial team · 7 min read · Updated 24 June 2026
Debt review works in five stages: you apply through a registered counsellor on Form 16, the counsellor assesses your budget and notifies creditors within five business days, a reduced repayment plan is negotiated, a magistrate's court makes it a binding order, and you then pay one amount monthly through a payment distribution agent until your debts are settled.
Throughout the process, the National Credit Act protects you from legal action and repossession on the debts in your plan, as long as you keep paying.
This page walks through each step in order, with the forms, timelines and fees involved, so you know exactly what happens after you sign up.
Step 1: Application (Form 16)
You contact an NCR-registered debt counsellor and complete the debt-review application, known as Form 16, under section 86 of the National Credit Act. You hand over your ID, payslips, bank statements and a list of every debt. The application fee is R50, the maximum set in the National Credit Regulations, and it is payable upfront before the assessment starts.
Within five business days, the counsellor must notify all your credit providers and the credit bureaus that you have applied. From that point, creditors should route communication through your counsellor.
Step 2: Affordability assessment
The counsellor builds a realistic monthly budget: income in, living costs out, and what is genuinely left for debt. This is the affordability assessment: the counsellor compares your income against your basic expenses and debt obligations.
If the numbers show you can pay your debts normally, you are not over-indebted and debt review may be declined. If they show you cannot, the counsellor calculates a single reduced payment you can sustain.
Step 3: Proposal to creditors
Your counsellor sends each creditor a restructuring proposal: a lower instalment, a longer term and, where they agree, reduced interest. Creditors can accept, negotiate or object. Secured debts like your car or home are handled carefully so you keep the asset while you pay.
Many creditors accept because a court can impose a restructuring anyway, and a paying customer beats a default.
Step 4: Court order (section 87)
If every creditor accepts the proposal, the counsellor files it with the National Consumer Tribunal as a consent order. If any creditor declines, the counsellor takes it to the magistrate's court, which reviews it and, if satisfied, makes a court order that legally binds you and your creditors to the new plan. This is the moment your repayment plan becomes enforceable. Your protection against legal action started earlier, when you applied and your creditors were notified.
Once the order is granted, you cannot simply walk away from debt review. You cannot withdraw from debt review after applying, and no court can rescind the order. The only exit is to pay the debts in the plan and receive a clearance certificate (a home loan can remain if it is up to date).
Step 5: Paying through a PDA
You usually pay one monthly amount to a payment distribution agent (PDA) registered with the NCR, which splits it among your creditors in the agreed proportions. The NCR says you can instead pay your credit providers directly. If you use a PDA, ask for its fee in writing.
You keep paying until every debt is settled. Then your counsellor issues a Form 19 clearance certificate, notifies the NCR and the bureaus, and the debt-review flag is removed from your profile.
What it costs each month
Debt-review fees follow the NCR's debt counselling fee guideline (rand amounts exclude VAT). The R50 application fee and R300 administration fee are paid upfront; the other fees fall due later:
| Fee | Regulated maximum |
|---|---|
| Application fee (upfront) | R50 |
| Administration fee (upfront) | R300 |
| Restructuring fee (once-off, month one) | The distributable amount or R8,000, whichever is lower (R9,000 if married in community of property) |
| Monthly after-care fee (from month three) | 5% of the distributable amount, capped at R450 |
| Reckless lending assessment (only if done) | R1,500 |
| Tribunal submission (consent order route) | R500, excluding the Tribunal's filing fee |
| Attorney (only if a court application is needed) | Agreed in writing when you apply |
These are ceilings, not quotes. A counsellor must disclose all applicable fees to you in writing before you sign.
Frequently asked questions
How does debt review work step by step?
You apply via a debt counsellor (Form 16), they assess your budget, notify creditors within five days, negotiate one reduced payment, and a magistrate's court makes it an order. You then pay monthly through a PDA until you are debt-free.
How long does it take to be placed under debt review?
Your counsellor must notify creditors within five business days of applying. The NCR says the application, negotiation and referral to the court or Tribunal must be completed within 60 business days of your application. The hearing date then depends on the court roll.
Who do I pay while under debt review?
You pay one amount each month to a registered payment distribution agent (PDA), not to each creditor. The PDA distributes the money to your creditors and sends you statements.
Can creditors still phone me during debt review?
Once you are in debt review, creditors should deal with your counsellor, not you. If a creditor keeps harassing you, tell your counsellor; persistent harassment can be reported to the NCR.
Do I keep my car and house under debt review?
Yes, in most cases. The plan includes your secured debts so you keep paying and keep the asset. Section 88 protects those goods from repossession while you stick to the plan.
What happens at the end of debt review?
When all your debts are paid, your counsellor issues a Form 19 clearance certificate, notifies the NCR and all credit bureaus, and the debt-review flag is removed from your credit profile, which the NCR circular gives the bureaus three working days to do after the Debt Help System is updated.
Is debt review run by my bank?
No. Debt review is run by an independent NCR-registered debt counsellor, not your bank. Your bank is one of the creditors the counsellor negotiates with on your behalf.
