Personal loan quotation and agreement: what you must be given and your right to settle early

Before a registered credit provider lends, the National Credit Act requires a pre-agreement statement and a written quotation. It must hold the quoted terms for five business days, give you a free copy of the agreement and charge only the fees section 101 lists. You may settle early at any time.

Olvian is a referral service, not a credit provider. We do not lend and we do not offer or advertise credit. This guide explains rules that apply to registered credit providers.

What must you be given before you sign?

Section 92 of the National Credit Act, 2005 (NCA) sets pre-agreement disclosure. The size of the agreement decides which parts apply, because the Act divides agreements into small, intermediate and large categories.

• For a small agreement, section 92(1) says the provider must not enter into it unless it has given you a pre-agreement statement and quotation in the prescribed form.
• For an intermediate or large agreement, section 92(2) says the provider must not enter into it unless it has given you a pre-agreement statement, either in the form of the proposed agreement or in another form that addresses all matters required by section 93, and a quotation in the prescribed form.

The quotation must set out the principal debt, the proposed distribution of that amount, the interest rate and other credit costs, the total cost of the proposed agreement, and the basis of any costs that may be assessed under section 121(3) if you rescind the contract.

Section 92(6) lets the provider send these on paper or in a printable electronic form.

A pre-approval is not a quotation. Section 92(7) says the section does not apply to an offer, proposal or pre-approval statement by which a provider merely signals willingness to consider an application for a hypothetical future agreement, generally or up to a specified maximum value.

How long do the quoted terms hold?

Section 92(3) gives you a window. For five business days after the quotation is presented, and subject to the provider's section 81 assessment and to section 101(1)(d)(ii), the provider must, at your request, enter into the agreement:

• for a small agreement, at or below the quoted interest rate or credit cost; and
• for an intermediate or large agreement, at or below the quoted rate or cost, or at a higher rate or cost by a margin no greater than the difference between the prevailing bank rates on the date of the quote and the date the agreement is made.

If credit is extended to buy an item of limited availability, section 92(4) lets the provider state that the quotation is subject to the continued availability of the item.

Take the five business days seriously. Read the quotation against the pre-agreement statement and ask the provider to explain anything you do not follow. Nobody should hurry you.

What can a credit provider charge?

Section 101(1) says a credit agreement must not require you to pay any money or other consideration except:

1. the principal debt, being the amount deferred under the agreement, plus any item section 102 allows;
2. an initiation fee, which may not exceed the prescribed amount for the principal debt and may not be applied unless the application results in a credit agreement with you;
3. a service fee, which for an ordinary loan may be payable monthly or annually and may not exceed the prescribed amount for the principal debt;
4. interest, expressed as an annual percentage rate calculated in the prescribed manner, which must not exceed the maximum prescribed rate under section 105;
5. the cost of credit insurance provided in accordance with section 106;
6. default administration charges, which may not exceed the prescribed maximum and may be imposed only if you have defaulted; and
7. collection costs, which may not exceed the prescribed maximum and may be imposed only as Part C of Chapter 6 permits.

The limits are set in regulations and change over time, so the Act alone will not tell you the figure. A registered credit provider can show you which limit applies to your agreement, and its quotation must set out the interest rate and other credit costs.

Section 101(2) adds that a provider that replaces an earlier agreement with the same consumer by a new one may charge an initiation fee on the new agreement only to the extent the regulations permit.

What about credit insurance?

If the provider proposes a particular credit insurance policy, section 106(4)(a) says you must be given, and told of, the right to waive that policy and substitute your own, subject to section 106(6). Section 106(2) says a provider must not offer or demand insurance that is unreasonable or at an unreasonable cost. Where the provider arranges the policy, section 106(5)(b) requires it to disclose the cost to you and the amount of any fee, commission, remuneration or benefit it will receive. Our guide on your right to choose your own credit life policy sets out the detail.

Do you get a copy of the agreement?

Yes, at no cost. Section 93(1) requires the credit provider to deliver to you, without charge, a copy of a document that records your credit agreement, on paper or in printable electronic form. Section 93(2) requires a document recording a small agreement to be in the prescribed form, and section 93(3) deals with intermediate and large agreements. Keep your copy with your quotation and the pre-agreement statement.

Is there a cooling-off period on a loan?

Not necessarily. Section 121 gives a right to terminate an agreement within five business days after signing it, but section 121(1) says the section applies only to a lease or an instalment agreement entered into at a location other than the credit provider's registered business premises. A personal loan is not ordinarily either. Do not assume you can cancel a loan after signing. Ask the provider what applies and read the agreement.

A cooling-off right for an insurance policy bought with the loan is a separate matter. Rule 4.2 of the Policyholder Protection Rules (Long-term Insurance) lets a policyholder cancel a new policy within 31 days of receiving the information described in Rule 11.5, if nothing has been paid or claimed.

Can you pay a loan off early?

Yes. Section 125(1) entitles a consumer to settle a credit agreement at any time, with or without advance notice to the credit provider. Section 125(2) says the amount needed to settle is the total of the unpaid balance of the principal debt, the unpaid interest and all other fees and charges payable up to the settlement date and, for a large agreement, an early termination charge. That charge is limited:

• for a fixed rate of interest, to no more than the prescribed charge or, if none is prescribed, the amount calculated as in the next point; and
• for any other rate, to no more than the interest that would have been payable for a period equal to three months less the period of notice you gave.

Section 126(1) separately says that at any time, without notice or penalty, you may prepay any amount owed under a credit agreement, and section 126(2) requires the provider to accept any payment when it is tendered, even before it is due. Section 126(3) says it must credit each payment from the date of receipt, applying it first to due or unpaid interest charges.

Ask the provider for a settlement figure in writing before you pay it off.

What if something is wrong?

If you think the provider has not given you the documents the Act requires, has charged something section 101 does not allow, or has not followed the quotation, start with the provider in writing. Section 136(1) lets any person complain to the National Credit Regulator (NCR) about an alleged contravention of the Act, and the National Financial Ombud Scheme handles credit complaints once you have first complained to the provider. Our guide on debt review and complaints sets out those routes.

Questions to ask when a provider calls

These are factual questions, not advice.

1. Are you a registered credit provider, and what is your registration number?
2. When will I receive the pre-agreement statement and quotation?
3. Which fees will the agreement include, and what is the annual interest rate expressed as a percentage?
4. Is credit insurance part of the agreement, and can I use my own?
5. What will it cost to settle early?

How does Olvian fit in?

Olvian is a referral service. You ask once, and we pass your request to registered credit providers who may contact you. Whether you are offered credit, and on what terms, is each provider's decision. We do not lend, arrange or advertise credit, and we do not tell you whether to take a loan.

Sources

Checked on 31 October 2026. Olvian is not a credit provider or financial adviser and this guide is information, not advice.

• National Credit Act 34 of 2005, section 92: pre-agreement disclosure
• Section 93: form of credit agreements
• Section 101: cost of credit
• Section 106: credit insurance
• Section 121: consumer's right to rescind credit agreement
• Section 125: right to settle agreement and section 126: early payments
• Section 136: complaints to the National Credit Regulator
• Policyholder Protection Rules (Long-term Insurance), Rule 4: cooling-off rights