Regulatory Information & Fee Structure | Transparent Lending
We Pawn Cars operates with complete transparency and in strict adherence to the laws governing short-term credit transactions in South Africa. We believe in empowering consumers with full visibility into how interest, initiation fees, and storage costs are calculated before signing any agreement.
Our Legal Framework: National Credit Act Compliance
Short-term asset-backed lending in South Africa is governed primarily by the National Credit Act (Act 34 of 2005) and the Second-Hand Goods Act (Act 6 of 2009). Under Section 1 of the NCA, a legitimate pawn transaction requires the lender to hold physical possession of the collateral asset.
Our operations comply with statutory limits:
Statutory Interest Rate Caps
Under Regulation 42 of the NCA, interest on short-term credit transactions is capped at a maximum of 5% per month for the first agreement and subsequent agreements, calculated on a simple daily diminishing balance.
Regulated Initiation & Service Fees
Initiation fees are strictly aligned with NCA schedules, capped at 15% of the loan amount up to R1,000 plus 10% on the excess. Monthly service fees are capped at R60 plus VAT per month.
Storage, Insurance & Security Costs
Because collateral vehicles are kept in high-security, access-controlled, and insured storage facilities, a reasonable storage and custodial fee is charged to cover:
- • 24/7 armed response, perimeter beam detection, and biometric access control
- • Comprehensive commercial garage-keeper insurance (fire, theft, storm, accidental damage)
- • Dust mitigation, tire pressure checks, and battery conditioning maintenance
All storage and security charges are clearly itemized in your pre-agreement quote. There are zero hidden administration charges, tracking device penalties, or unannounced exit fees.
Transparent, Ethical Lending
Get a clear, written quotation with zero obligations before pledging your vehicle.
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