What is the Process for Default  Debtor Listing?

When Does a Client Receive a Default Listing? 

To receive a default debtor listing, a debtor must be in arrears for 3 consecutive months before a default notice (21-day Notice Letter / Letter of Demand) can be sent to the client. A notice can be issued to the debtor according to section 29 of the National Credit Act (NCA), advising the debtor that their account is in arrears and non-payment may result in default listing with a Credit Bureau, or legal action.

What is Default Listing and How Does It Help Your Business?

Understanding what a default listing is is important for businesses managing their credit risk. Default listing is a process where a debtor’s failure to meet payment obligations is reported to a credit bureau, resulting in a negative mark on their credit record. This default listing process begins with a formal notification to the debtor, providing them with a final opportunity to settle the outstanding amount before the default is officially recorded.

In addition to managing debtor default, businesses should also be familiar with maintaining a debtors list. This list tracks all individuals or entities that owe money, helping businesses monitor outstanding debts and manage credit risk effectively. By utilising tools such as a default notice and understanding the implications of a debtor listing, companies can take proactive steps to protect their financial health and ensure better credit management practices. Contact us today for assistance with managing the default debtor listing process.