MONEY CLINIC | Can creditors just deduct money from my bank account?

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It is advisable that you regularly check your bank statements for transactions you do not recognise.
It is advisable that you regularly check your bank statements for transactions you do not recognise.
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A Fin24 reader who returned to the country after five years abroad found that he had received a few judgments for outstanding debt. He wants to know if creditors are allowed to deduct money from his account.

He writes: 

I am 56 years old. I have debts that accumulated before 2016. I left South Africa in 2017 and came back about a year ago. I then checked my credit score and found out that I had received a few judgments while I was abroad. I currently have got no job nor any source of income.

I then received an email from one of my creditors with a court order stating that they will be deducting money from my account. Can they do that? In practical terms: if someone deposits R500 into my account, for example, could they take it? 

Renee Marais, registered and independent debt counsellor with the NCR, responds:

Credit providers may NOT deduct money from any of your accounts. It was declared in a judgment between the National Credit Regulator and Standard Bank handed down in June 2019 that common law "set-off," as it is known, is unlawful.

Even if the contract or credit agreement included such permission, it is still not lawful. No one may deduct funds from your bank accounts unless you have signed or given written consent for a debit order for a specific deduction from a particular account adequately identified.  

Here is a copy of the judgment: National Credit Regulator v Standard Bank

Summary of the judgment

National Credit Act - section 90(2)(n) and section 124 - interpretation of - effect of these provisions on common-law set-off for credit agreements under the Act - Declarator granted that in light of sections 90(2)(n) and 124 of the National Credit Act 34 of 2005, the common law right to set-off is not applicable in respect of credit agreements which are subject to the National Credit Act.

What can you do with unlawful debit orders?

It is advisable that you regularly check your bank statements for transactions you do not recognise. Query transactions you did not give permission for or agreed to with your bank immediately and report the details to the Payments Association of South Africa at if there is any such strange activity on your account.  

Nothing prevents you from attempting to make a repayment arrangement with any of the lawyers representing the credit providers, or the credit providers themselves.   

Unfortunately, I am not a lawyer and my opinion is not legal advice and should not be construed as such. It is advised that you contact a lawyer for legal assistance or legal aid, or a law clinic at one of the local universities, which sometimes helps consumers who have difficulty affording expensive legal assistance.  

Here is the website for Legal Aid and Legal Aid's contact details:

1. Phone 1: 011 877 2000 (national office reception)

2. Phone 2: 0800 110 110 (toll-free legal aid advice line)

3. Phone 3: 0800 153 728 (legal aid ethics hotline)

4. Phone 4: 079 835 7179 (please-call-me number)

5. Email:

6. Facebook: @LegalAidSA1. 

Questions may be edited for brevity and clarity.

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