How debt review works
How does debt review work in South Africa?
By Lerato Molefe · 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 upfront application fee is R50, a maximum regulated by the NCR.
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, and from 2026 the NCR requires it to follow a standardised method so the figure is fair and consistent.
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)
The counsellor takes the proposal to the magistrate's court under section 87. The magistrate 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 and your section 88 protection is firmly in place.
Once the order is granted, you cannot simply walk away from debt review. Exiting before you are paid up usually needs a court application to rescind the order.
Step 5: Paying through a PDA
You pay one monthly amount to a registered payment distribution agent (PDA), which splits it among your creditors in the agreed proportions and sends you statements. The PDA charges R15 per payment over R500.
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 are regulated maximums set by the NCR and added to your monthly payment:
| Fee | Regulated maximum |
|---|---|
| Application fee (upfront) | R50 |
| Admin fee | Up to R300 |
| Once-off restructuring fee | Up to R8,000 (R9,000 for couples married in community of property) |
| Monthly after-care fee | 5% of your instalment, capped at R450/month |
| PDA fee | R15 per payment over R500 |
These are ceilings, not quotes. A good counsellor explains exactly what you will pay before you sign, and the 2026 rules tighten that upfront disclosure.
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 protective court order under section 87 usually follows within a couple of months, depending on the court roll and creditor responses.
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, usually within about 21 business days.
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.
