Debt Collection Services South Africa
Bizztax Accountants assists South African businesses with establishing credit application procedures and providing debt collection services for companies with outstanding debtors.
What are debt collection services?
Debt collection services assist businesses in recovering outstanding amounts owed by debtors. In South Africa, debt collection is regulated by the Debt Collectors Act 114 of 1998 and the National Credit Act 34 of 2005. Effective debt collection starts with proper credit application procedures — ensuring you have the correct information and agreements in place before extending credit to customers.
Who needs debt collection services?
Any business that extends credit to customers — whether through invoicing, trade credit or instalment arrangements — is exposed to the risk of bad debts. Businesses with growing debtor books, high levels of overdue accounts or customers who dispute invoices benefit most from professional debt collection assistance. Bizztax helps businesses establish proper credit procedures and recover outstanding amounts efficiently.
Our Debt Collection Services
Credit Application Procedures
We assist businesses in establishing proper credit application procedures, including credit application forms, terms and conditions of sale, and credit limit policies. Proper documentation is essential for effective debt collection and protects your business in the event of a dispute.
Debtor Management
We advise on debtor management best practices, including invoicing procedures, payment terms, follow-up processes and escalation procedures. Effective debtor management reduces the risk of bad debts and improves cash flow.
Debt Collection
We assist businesses in collecting outstanding amounts from debtors, including written demand letters, negotiation of payment arrangements and referral to legal processes where necessary. We act professionally and in accordance with South African debt collection legislation.
Frequently Asked Questions
Common questions about debt collection for South African businesses.
What is the prescription period for debts in South Africa?
Most debts in South Africa prescribe (expire) after three years under the Prescription Act 68 of 1969. This means that if you do not take steps to collect a debt within three years of it becoming due, you may lose the right to collect it. It is important to act promptly when a debtor fails to pay.
What should I include in a credit application form?
A credit application form should include the debtor's full legal name and registration number (for companies), physical and postal address, contact details, banking details, trade references, and a signed acknowledgement of your terms and conditions of sale. For individuals, you should also obtain their ID number and consent to a credit check.
Can I charge interest on overdue accounts in South Africa?
Yes, you can charge interest on overdue accounts, provided this is agreed to in your terms and conditions of sale. The maximum interest rate is regulated by the National Credit Act for credit agreements. For business-to-business transactions not covered by the NCA, the agreed rate applies, or the prescribed rate under the Prescribed Rate of Interest Act if no rate is agreed.
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Get help with debt collection
Contact Bizztax Accountants for debt collection services and credit procedure advice for your South African business.