How the process works:

The debt collection process in South Africa step by step:

• Issuing the Initial Notice: The debtor will receive an initial notice from the creditor or the debt collection agency, informing them of the outstanding debt and requesting payment.
  
• Letter of Demand: If the debtor does not respond to the initial notice, a formal “Letter of Demand” is sent, specifying the amount owed, the creditor’s details, and a deadline for payment.
  
• Verification of Debt: If the debtor disputes the debt, they can request validation and verification of the debt’s accuracy, including the original contract or agreement.
  
• Cease Communication: Debt collectors must cease communication with the debtor for a specified period (usually 10 business days) while the verification process takes place.
  
• Negotiation and Repayment: If the debt is confirmed as valid, the debt collector and debtor can negotiate a suitable repayment plan or settlement amount.
  
• Legal Action: If negotiations fail, the creditor or debt collection agency may pursue legal action, which could result in obtaining a court judgment against the debtor.
  
• Enforcement of Judgment: With a court judgment, the creditor may take further action to recover the debt, such as wage garnishment, property attachment, or a bank levy.
  
• Debt Review (Debt Counselling): Debtors who are struggling to repay their debts may apply for debt review, which allows them to work with a debt counsellor to restructure their debts and create an affordable repayment plan.