Documents you need for a loan application in South Africa

Which documents do lenders usually ask for?

The exact list is the lender's choice, and you will find it on the lender's application page or in the application itself. The items below are the ones that appear most often for a personal or short-term loan.

The lenders on this site describe their own requirements in their own words. Century and Creditomax state that applicants must be South African citizens aged 18 to 70 with a valid identity document, and Jabulani Money states a minimum age of 18. Providers also say their process needs minimal paperwork. Read that as the provider's own statement and check what is actually requested before you start.

Why do lenders ask for so many documents?

Because the law says they must check. The National Credit Regulator (NCR) explains that its affordability assessment regulations require credit providers to verify your income before granting credit. They must take practical steps to work out your discretionary income, which is your gross income less tax, UIF, maintenance and all other payment obligations.

The lender must also consider all debt repayment obligations shown on a registered credit bureau record. The NCR notes that this protects consumers from reckless lending, in which a lender grants credit that the person cannot afford.

So the paperwork is not a trick. It is how a lender shows that it assessed your position, and how you show the lender an honest picture.

What proof of income is accepted if you are salaried or self-employed?

The NCR's guidance on the affordability regulations sets out what a lender should request. For a salaried consumer it is the latest three payslips, or bank statements showing the latest three salary deposits.

For consumers who do not receive a salary, the lender should ask for the latest three documented proofs of income or the latest three months of bank statements. For self-employed or informally employed people who do not receive a payslip, the lender should ask for three months of bank statements or the latest financial statements.

Where your income varies, for example with commission, shifts or seasonal work, the NCR says the lender should use an average gross income over at least three pay periods. A lender that follows this approach is working to the guidance, and you can offer extra statements to give a fuller picture.

How should you prepare your documents?

Preparing before you apply saves you from sending half an application and waiting. Gather everything in one place, then check that each document is clear, current and complete.

Quality matters as much as quantity. A blurred photo or a cropped page can hold up a decision, because the lender must be able to read the figures it is verifying.

• Scan or photograph each document flat, in good light, with all four corners and every page visible.
• Use recent proof of address, and check how recent the lender wants it to be, because three months is a common limit.
• Download full bank statements from your bank's app or website, not screenshots of a balance.
• Make sure the name on each document matches your ID.
• Save files with clear names, such as 'payslip-september', and keep copies for your records.
• Add up your monthly income, debit orders and living costs so that the figures you declare match your documents.

Why must the details you give be accurate?

The NCR stresses that consumers must disclose all their financial obligations accurately and provide authentic documentation. It warns that if a consumer fails to disclose information truthfully, they may lose the protection offered by the National Credit Act.

It has also observed that some consumers under-declare their monthly living expenses to improve their chances. For that reason the regulations include a table of minimum living expense norms based on gross monthly income, and a lender may ask you to complete a questionnaire when your declared expenses are lower than the norm.

Honest figures protect you. A loan that fits your real budget is far less likely to turn into a debt problem.

How is your personal information protected?

Two sets of rules apply. The NCR's consumer rights leaflet states that you have a right to have the information held about you treated confidentially, and that the credit provider may only use it for the purpose for which it was given.

The Protection of Personal Information Act (POPIA) adds general principles. Information may be processed only if, given the purpose, it is adequate, relevant and not excessive. Records may not be kept longer than necessary for the purpose, unless a law, a contract or your consent allows it. You can ask a company, free of charge, to confirm whether it holds your personal information, ask for the record, and request correction or deletion of information that is inaccurate, out of date or excessive. The Information Regulator oversees POPIA.

In practice, send your documents only through the lender's own secure application or app, and ask how long the lender keeps them. Mzansi Hub does not collect loan application documents. If you apply, you do so with the lender.

What should a lender never ask for or keep?

A registered lender may ask for the documents above, but there are limits. The NCR states that it is illegal for a credit provider to retain a consumer's identity document or bank card when granting credit, and that doing so is a criminal offence under the National Credit Act. Its advice is to fetch the document back and, if the provider refuses, report it to the police and the NCR.

The NCR also advises that consumers should never leave bank cards, SASSA cards, PINs or identity documents with credit providers, and that no upfront payment should be made to be granted a loan. The Act further says a credit provider must not require or induce you to obtain a credit bureau report as part of an application.

• Your card PIN, your OTP or your online banking password.
• Your bank card, SASSA card or original ID kept as security.
• Any fee, insurance payment or 'admin charge' before the loan is paid out.
• A paid credit report as a condition of applying.

What causes delays in a loan application?

Most delays are small and avoidable. The lender cannot finish its assessment until it has readable, current documents that agree with each other.

If your application stalls, ask the lender exactly what is missing instead of resubmitting everything, and answer in writing so there is a record.

• Blurred, cropped or incomplete scans.
• Bank statements covering fewer months than requested.
• Proof of address that is out of date or in someone else's name.
• Declared income that does not match the statements.
• A different name or ID number on different documents.
• Missing details such as employer contact or bank account number.

What is a simple checklist before you apply?

Use this list as a final check. It takes about ten minutes and often saves days.

Remember that sending the documents does not mean the lender will say yes. The lender decides after its affordability assessment, and you decide whether the quotation suits your budget.

• I have confirmed the lender is a registered credit provider on the NCR register.
• I have my ID, proof of address, payslips or statements ready, all current and readable.
• My declared income and expenses match my documents.
• I will send documents only through the lender's own secure channel.
• I will not share a PIN, OTP or banking password, and I will not pay anything upfront.
• I will read the quotation and agreement and keep copies.