Usury Act, 1968 (Act No. 73 of 1968)3. Compulsory disclosure of finance charges |
| (1) | A moneylender carrying on the business of money lending or his authorised representative shall, on demand before the conclusion of any money lending transaction in connection with which finance charges are or will be payable, furnish separately, distinctly and in writing to the prospective borrower, and, whether or not any such demand is made, shall set out separately and distinctly in every instrument of debt executed in respect of any such transaction, in so far as the same may be known and determinable, the following particulars: |
| (a) | The cash amount in money actually received by or on behalf of the borrower or which will be received by or on behalf of the borrower or prospective borrower; |
| (b) | all other charges, shown separately, forming part or which will form part of the principal debt; |
| (c) | the principal debt, that is, the sum of the amounts referred to in paragraphs (a) and (b); |
| (d) | the amount in rand and cents of the finance charges calculated at the annual finance charge rate mentioned in paragraph (e); |
| (e) | the annual finance charge rate; and |
| (f) | as the case may be, the date upon which or the number of instalments in which the principal debt together with the finance charges must be paid, the amount of each instalment and the date upon which each instalment must be paid or the manner in which that date is determined. |
| (2) | A credit grantor who transacts credit transactions in the normal course of his business or his authorised representative shall, on demand before the conclusion of any credit transaction in connection with which finance charges are or will be payable, furnish separately, distinctly and in writing to the prospective credit receiver, and, whether or not any such demand is made, shall set out separately and distinctly in every instrument of debt executed in connection with any such transaction, in so far as the same may be known and determinable, the following particulars: |
| (a) | The selling price of the foods sold or to be sold or the sum of money charged or which will be charged for the use or enjoyment of the goods; |
| (b) | all other charges, shown separately, forming part or which will form part of the principal debt; |
| (c) | the cash amount in money or the reasonable value of goods deducted or which will be deducted at the conclusion of the transaction from the amount referred to in paragraph (a); |
| (d) | the principal debt, that is, the sum of the amounts referred to in paragraphs (a) and (b) less the amount referred to in paragraph (c); |
| (e) | the amount in rand and cents of the finance charges calculated at the annual finance charge rate mentioned in paragraph (f); |
| (f) | the annual finance charge rate; and |
| (g) | as the case may be, the date upon which or the number of instalments in which the principal debt together with the finance charges must be paid, the amount of each instalment and the date upon which each instalment must be paid or the manner in which that date is determined. |
| (2A) | A lessor who transacts leasing transactions in the normal course of his business or his authorised representative shall, on demand before the conclusion of any leasing transaction, furnish separately, distinctly and in writing to the prospective lessee and, whether or not any such demand is made, shall set out separately and distinctly in every instrument of debt executed in connection with any such transaction, the following particulars: |
| (a) | The cash price at which the movable property leased or to be leased, is normally sold by the lessor on the date on which such transaction is concluded or, where the lessor is not a trader normally selling any such movable property, the market value of such movable property or, when applicable, the money value determined in terms of section 6K in respect of such movable property; |
| (b) | [deleted by s.4 of Act No. 100 of 1988]; |
| (c) | the cash amount in money or the reasonable value of property deducted or to be deducted at the conclusion of the transaction from the cash price, market value or money value referred to in paragraph (a); |
| (d) | the present value of the book value of the leased property deducted or to be deducted at the conclusion of the transaction from the cash price, market value or money value referred to in paragraph (a); |
| (e) | the book value of the leased property; |
| (f) | in so far as the same is known and determinable— |
| (i) | all other charges forming part or which will form part of the principal debt; |
| (ii) | the principal debt, that is, the sum of the amounts referred to in paragraph (a) and subparagraph (i) less the sum of the amounts referred to in paragraphs (c) and (d); |
| (iii) | the amount in rand and cents of the finance charges calculated at the annual finance charge rate stated in subparagraph (iv); |
| (iv) | the annual finance charge rate; |
| (v) | the date with effect from which finance charges are to be paid by the lessee; and |
| (vi) | as the case may be, the date upon which or the number of instalments in which the principal debt together with the finance charges must be paid, the amount of each instalment and the due date of each instalment or the manner in which that date is determined. |
| (3) | The provisions of subsections (1), (2) and (2A) shall not apply to or in respect of— |
| (a) | a bill of exchange when such bill is executed or discounted by the South African Reserve Bank, the Corporation for Public Deposits or a banking institution as defined in section 1(1) of the Banks Act, 1965 (Act No. 23 of 1965); |
| (b) | [deleted by s.4 of Act No. 100 of 1988]; |
| (c) | a debit balance in an account with a banking institution as defined in section 1(1) of the Banks Act, 1965, out of which withdrawals may be made by cheque or on other instructions of clients; |
| (d) | a money loan given by a life insurer to the owner of a policy in terms of which such insurer is subject to any obligation, where such loan is secured by the pledge of that policy; |
| (e) | [deleted by s.3 of Act No. 30 of 1993]; and |
| (f) | [deleted by s.3 of Act No. 30 of 1993]. |
| (4) | Where the particulars referred to in subsection (1), (2) or (2A) are furnished in a document which also contains other information, such particulars shall be furnished in writing not less conspicuous than the writing in which such other information is furnished. |
| (5) | The provisions of subsections (1), (2) and (2A) shall not be construed as prohibiting any moneylender or credit grantor or lessor from charging a borrower or credit receiver or lessee in respect of a money lending transaction or a credit transaction or a leasing transaction, finance charges at a lesser rate than the annual finance charge rate disclosed in the instrument of debt relating to such a transaction. |
| (6) | Any person who makes or executes or is a party to the making or execution of, or as cessionary or otherwise accepts or holds, an instrument of debt which does not comply with the provisions of subsections (1), (2) or (2A) and (4), knowing that it does not so comply, shall be guilty of an offence. |
| (7) | Any person who wilfully makes or executes, or is knowingly a party to the making or execution of an instrument of debt which contains a statement which is false as to any of the particulars required to be inserted therein by subsection (1), (2) or (2A), and any person who utters any such instrument of debt knowing that it contains any such false statement, shall be guilty of an offence. |
| (8) | Notwithstanding anything in this section contained, but subject to the provisions of section 5, no instrument of debt shall be deemed to be invalid or defective merely by reason of the fact that it does not comply with any provision of subsection (1), (2), (2A) or (4) of this section. |
| (9) | Where separate instruments of debt are concluded by the same moneylender or credit grantor or lessor and the same borrower or credit receiver or lessee in respect of the same money lending transaction or credit transaction or leasing transaction, such separate instruments of debt, including an instrument of debt relating to insurance premiums paid on behalf of a credit receiver or borrower or lessee, shall for the purposes of this Act be deemed to be a single instrument of debt containing the provisions of such separate instruments of debt, and such single instrument of debt shall not include-- |
| (a) | any valuable consideration not specifically included in the principal debt by this Act; |
| (b) | any finance charges which may not be stipulated for, demanded or received in terms of this Act. |
| (10) | [Deleted by s.2 of Act No. 91 of 1989]. |