Large, Intermediate & Small Credit Agreements under the NCA: Section 9 Thresholds [2026]

Why classification matters

Once you have decided that an arrangement is a credit agreement and that the National Credit Act applies to it, the next question the Act forces on you is its size. Section 9 characterises every credit agreement as small, intermediate or large, and that label is not a filing convenience — it drives real consequences:

• The form of the agreement document. Under s 93 the required form tracks the size band: a small agreement’s document must be in the prescribed form, while an intermediate or large agreement must use the prescribed form for its category if one has been prescribed, and otherwise may use any form the credit provider determines that complies with the prescribed requirements.
• Whether the Act applies at all. For a juristic-person consumer below the R1 million threshold, the classification feeds straight into the exclusion in s 4(1)(b) read with s 9(4): a large agreement is taken outside the Act altogether. This is the point that decided Profit Hub, and the reason this is not a dry cataloguing exercise.

One right is often wrongly described as size-driven but is not: the five-business-day cooling-off right turns on the type and place of the agreement, not its size. Under s 121 it is engaged only by a lease or an instalment agreement signed away from the credit provider’s registered business premises:

Because the third consequence can switch the entire regulatory regime on or off, getting classification right is a first-order question for any lender, business borrower or surety — not an afterthought.

The three sizes: section 9

Section 9 sets out the categories in full. Note that the sizing is done against “the lower” and “the higher” of two thresholds the Minister fixes under s 7(1)(b) — the section itself carries no rand figures; those live in the gazetted determination quoted further down.

Reading that through, the structure becomes simple once you separate the three building blocks:

• Pawn transactions are always small. A pawn transaction is a small agreement regardless of amount (s 9(2)(a)).
• Mortgages are always large. A mortgage agreement is a large agreement regardless of amount (s 9(4)(a)) — there is no “small mortgage”.
• Credit guarantees are never sized. A credit guarantee is expressly carved out of all three bands; it takes its character from the underlying agreement it secures.
• Everything else is sized by the money. Ordinary credit facilities and credit transactions are placed in a band by comparing the credit limit (facilities) or principal debt (transactions) against the two thresholds.

The thresholds: section 7(1)(b)

Section 9 speaks of “the lower” and “the higher” threshold but does not name the amounts. Those come from s 7(1), which obliges the Minister to gazette the figures — and, separately, the R1 million juristic-person threshold under s 7(1)(a):

The Minister did so in 2006, and those figures are still in force:

Putting s 9 and the determination together, the bands for an ordinary (non-pawn, non-mortgage) deal are:

• Small — a credit facility (by limit) or credit transaction (by principal debt) at or below R15 000, plus every pawn transaction.
• Intermediate — a credit facility above R15 000, or a credit transaction whose principal debt falls above R15 000 and below R250 000.
• Large — a credit transaction with a principal debt at or above R250 000, plus every mortgage agreement.

How size is measured: credit limit vs principal debt

The threshold is applied to two different yardsticks depending on the species of agreement, and getting the right yardstick is where mistakes happen.

For a credit facility — a credit card, store card, cheque-account overdraft — the size is measured against the credit limit, not the balance actually drawn. The Act says so expressly:

So a credit card with a R40 000 limit is an intermediate agreement from the start, even at a zero balance. For a credit transaction — a once-off loan, instalment sale or secured loan — the size is measured against the principal debt, broadly the amount advanced or financed plus capitalised charges. That distinction is why the same R200 000 can be intermediate as a one-off loan but is dwarfed, as a card limit, only if the limit itself crosses R250 000. The species of agreement — facility, transaction or guarantee — therefore has to be settled before you can classify it by size, which is why the firm’s guide to facilities, transactions and guarantees is the necessary first step.

The large-agreement exclusion for juristic persons

For a natural person, classification changes the paperwork and the procedural rights but never removes NCA protection. For a juristic person — a company, close corporation or trust below the R1 million asset/turnover threshold — classification can switch the Act off. There are two juristic-person exclusions in s 4(1), and the second turns directly on size:

The two exclusions divide the juristic-person world cleanly:

• Big company (s 4(1)(a)(i)). If the consumer is a juristic person whose asset value or turnover (aggregated with related juristic persons) equals or exceeds R1 000 000, the Act does not apply to any of its credit agreements, large or small. We unpack the R1 million company exemption — including how related-person aggregation works — in its own guide.
• Smaller company (s 4(1)(b)). Even where the company is below R1 million, the Act still does not apply to its large agreements — that is, any mortgage or any other credit transaction with a principal debt at or above R250 000. Below R250 000, a sub-R1m company keeps full NCA protection; at or above it, it does not.

The net effect for companies: the only NCA-regulated credit agreements a juristic person can have are small or intermediate agreements where the company is below the R1 million threshold. Everything large, or every agreement of a company at or above R1 million, sits outside the Act — which is precisely the territory Profit Hub occupied.

Profit Hub v Zuwon: a worked example of the exclusions

The Supreme Court of Appeal’s 2026 decision in The Profit Hub (Pty) Ltd v Zuwon Consultants (Pty) Ltd is the leading recent authority on how these exclusions actually bite. The court first had to decide what the agreements were — and approached that, as always, through substance, not label, using the interpretive triad from Natal Joint Municipal Pension Fund v Endumeni Municipality:

Applying the century-old test in De Villiers v Roux — which the SCA reproduced as its starting point — the agreements, though styled as “discounting”, were in substance loans: Zuwon had to repay the advance plus a 13% factoring fee whether or not its debtors paid, and gave suretyships as security, so the cession was security rather than a sale:

Having held the agreements were loans, the court went on to find they were not even credit facilities, because a facility requires the provider to pay amounts “as determined by the consumer from time to time” — the revolving autonomy of a credit or store card (a point the court drew from JMV Textiles v De Chalain) — which a fixed, once-off advance does not have:

But the decisive step for our purposes is the threshold analysis. The advances were R290 000 and R270 000 — each above R250 000 — so each agreement was a large agreement, and Zuwon was a company. On those facts the court held the Act simply did not apply, whichever side of the R1 million line Zuwon’s turnover fell:

The lesson is that classification did real work: the same loans, had they been for R240 000 to the same sub-R1m company, would have been intermediate agreements and fully inside the NCA — with all the registration and disclosure duties that brings.

Getting classification wrong

The flip side of Profit Hub is the warning in Loan Company (Pty) Ltd v National Credit Regulator. If an agreement is not excluded — because it is small or intermediate, or because the borrower is a natural person — then the credit provider must be registered, and registration is now compulsory for essentially everyone. The former “100 credit agreements” trigger in s 40(1) was deleted, and the registration threshold was cut to nil:

Mis-classify a regulated agreement as excluded, lend without registering, and the consequences are severe: an unregistered credit provider’s agreement can be declared unlawful and void, with refunds to the consumer ordered and administrative fines imposed — the outcome confirmed in Loan Company v NCR [2025] ZASCA 40. Classification therefore cuts both ways: it can lift an agreement out of the Act (as in Profit Hub), or it can expose a careless lender to the full weight of the enforcement regime.

A short due-diligence sequence keeps you on the right side of the line. First, settle the species — facility, transaction or guarantee. Second, identify the borrower — natural person, or juristic person above or below R1 million. Third, measure the size against R15 000 and R250 000 (credit limit for facilities; principal debt for transactions). Fourth, only then decide whether an exclusion applies and whether registration, disclosure and affordability duties are engaged. Where a juristic-person borrower relies on a threshold, record its stated asset value or turnover in the agreement, since s 4(2)(a) measures it as “the value stated as such by that juristic person at the time it applies for or enters into that agreement”.

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