The Minister of Trade, Industry and Competition, Parks Tau, has withdrawn the draft amendments to the Regulations under the National Credit Act (NCA) following widespread opposition – a move that has, in turn, resulted in organised business publicly criticising Tau.
The draft amendments were published in the Government Gazette on 13 August for public comment.
Read: Draft NCA regulations widen credit-data scope and tighten affordability tests
The opposition was sparked by the amendments to Regulation 18, which addresses the maintenance and retention of consumer credit information by credit bureaus. Sub-regulation (7) would permit registered credit bureaus to receive consumer credit information from, among others, educational institutions. Critics said this provision would result in graduates being “blacklisted” from loans and jobs.
The Department of Trade, Industry and Competition (DTIC) issued a statement on 11 September announcing the withdrawal of the draft amendments. It said Tau’s decision was informed by the more than 20 000 submissions received before the deadline of 12 September. Most of the submissions opposed the proposed regulations.
The DTIC said Tau has committed to undertaking a process that will consider the changes required to enhance the protection of students, while continuing with efforts aimed at improving access to finance for small businesses, to plug the credit funding gap.
The existing Regulations, which were promulgated in 2006, already provide for credit bureaus to receive consumer information from these institutions.
The substantive difference between the current Regulation 18(7) and the proposed Regulation 18(7) is that the term “consumer” is explicitly broadened to include a juristic person.
The Deputy Minister in the Presidency, Nonceba Mhlauli, noted in speech on Thursday that educational institutions are currently included the Regulations. “If you look at the legislation of 2006, they have actually always been there. What other parties are trying to present as a new regulation has actually always been in law,” she was quoted as saying by The Citizen.
She said that over the past 19 years, there have been no reported cases of students being unfairly blacklisted.
Mhlauli said the “big question” is whether consumers should be blacklisted because of information received from educational institutions. She suggested that parliament discusses amending the law to protect young people by removing educational institutions from the list.
Moonstone asked Tau’s spokesperson to clarify why objections to the reporting of student debt provision resulted in the withdrawal of the draft amendments, whereas the Regulations already contain this provision. A response had not been received by the time of publication.
Business objects to the withdrawal
The Banking Association South Africa (BASA) and Business Unity South Africa (BUSA) have criticised Tau for his decision to withdraw the proposed amendments.
In a statement released on Sunday, BASA said the decision has undermined due process and the interests of micro, small, and medium enterprises (MSMEs), attributing the move to misinformation.
It said Tau’s action came before the official closing date for public comments on the draft regulations. According to BASA, Tau based his decision on the assertion that the vast majority of submissions received up to that point were opposed to the proposals. The association said no evidence was provided to substantiate this claim.
BASA said the minister’s choice not to await the full range of inputs reflected a disregard for proper, meaningful, and legally required consultation. This occurred amid what the association described as misplaced and misinformed political pressure.
BASA clarified the provision in the draft amendments related to student debt was misunderstood as permitting the blacklisting of students who owe tuition fees.
“The proposed draft amendments have nothing to do with allowing credit bureaus to receive credit information from educational institutions. The provision for credit bureaus to receive credit information from educational institutions has been in the NCA since 2006,” BASA said.
“It is not a new proposal and has not been introduced in the draft amendments. It is unfortunate that the minister and his department were seemingly not aware of the provisions in the legislation for which they are responsible.”
BASA said the withdrawal of the draft amendments has left urgent unfinished business in the small business credit market unresolved. Data from the 2025 MSME Access to Finance report found that small businesses contribute about 40% to South Africa’s gross domestic product (GDP) and employ about 60% of the workforce. Despite this economic significance, these enterprises face a substantial funding gap estimated at R350 billion.
The scrapped amendments were part of extensive work conducted through a business-government partnership specifically to support small businesses. BASA contended that disrupting this initiative renews broader concerns about the government’s approach to economic policy. Rather than a coherent and complementary framework, the association suggested that the current setup involves a cluster of ministers and departments pursuing their own short-term interests, which hampers effective support for MSMEs.
Business Times quoted BUSA chief executive Khulekani Mathe as criticising Tau for mishandling the policymaking process and succumbing to political pressure. He said proper procedures were not followed, especially after the Department of Trade, Indu
Mathe doubted the DTIC could review 20 000 submissions in a week, calling the claim “simply not true”.
The draft regulations were intended to ease credit access for small and medium enterprises (SMEs), particularly those with turnovers below R1 million, by treating them as juridical persons rather than natural persons. This would reduce onerous criteria for developmental credit.
BUSA said its submissions focused solely on SME credit access and did not address student debt. The withdrawal delays these beneficial changes, which align with economic growth plans such as the National Development Plan.
Mathe also noted that the provisions on student debt reporting have been in the NCA since 2006 but were never used maliciously. He faulted the government for not explaining this clearly and instead withdrawing the entire draft, rather than isolating the contentious parts.
BUSA viewed this as a threat to policymaking integrity. Mathe said that allowing ministers to abruptly pull drafts undermines consultation processes, such as those in the National Economic Development and Labour Council. He questioned the value of mobilising responses if policies can be derailed on “flimsy grounds”.
Although no decision has been made on legal action, BUSA hoped to salvage the SME-focused amendments without compromise.
