How to Get Loans in South Africa if Blacklisted or Bad Credit | The Truth

By Princella Esther Agyei Certified Credit Counselor & HR Manager, HR People Associates
It’s a word that can cause instant panic for any South African: “blacklisted.”

For years, it has been used as a financial death sentence, a term that suggests all doors to credit are permanently slammed shut. If you’ve been told you are “blacklisted” or fear that you might be, the feeling of hopelessness can be overwhelming.

But what if we told you that the blacklist doesn’t actually exist?

As of 2025, it’s time to replace the fear of this myth with the power of knowledge. This guide will reveal the truth behind the term, show you exactly where you stand financially, and walk you through the legitimate options you still have for getting a loan in South Africa.

Let’s Debunk the Myth: There is No “Blacklist”

Let’s be perfectly clear: there is no single, official “blacklist” that your name gets put on. It is a myth.

The term is informal slang for having a poor credit record. When you apply for credit, lenders check your credit report, which is compiled by registered credit bureaus in South Africa. These bureaus include:

• TransUnion
• Experian
• Compuscan
• XDS

Instead of a “blacklist,” what they see is a detailed history of your financial behaviour. A “bad” credit record is one that contains negative listings, such as:

• Defaults: When you have missed payments on an account for several months.
• Judgments (CCJs): When a creditor has taken legal action against you for non-payment, and the court has ruled in their favour.
• Debt Review: A flag indicating you are currently under the formal debt review process.

These listings, not some mythical list, are what make it difficult to get approved for credit by mainstream banks.

Know Your Power: How to Check Your REAL Credit Score for Free

Before you can fix a problem, you need to understand it. Under South Africa’s National Credit Act (NCA), you are legally entitled to one free credit report from each of the credit bureaus every year.

Taking this step is non-negotiable. It moves you from a position of fear to one of control.

How to get your report:

1. Visit the websites of the main credit bureaus (TransUnion, Experian, etc.).
2. Follow their instructions for requesting your free annual report. You will need to verify your identity (usually with your ID number and other personal details).
3. Receive your report and review it carefully. Check for any errors or accounts you don’t recognise.

Your report will show you exactly what lenders see. This information is your roadmap to financial recovery.

Your Legitimate Loan Options (Even with a Poor Score)

So, your credit record isn’t perfect. Does that mean you have zero options? Absolutely not. While major banks may say no, there are other NCR-registered lenders who specialize in providing credit to higher-risk clients. Here are your primary options:

1. Secured Loans

A secured loan is tied to an asset that you own, which you use as collateral. This reduces the risk for the lender, making them more likely to approve the loan.

• Example: Using your fully paid-off car or property to secure a loan.
• Warning: If you fail to repay the loan, the lender has the right to repossess the asset you used as security.

2. Guarantor Loans

This involves getting a friend or family member with a good credit history to “co-sign” your loan application.

• How it Works: The guarantor agrees to be legally responsible for repaying the debt if you are unable to.
• Warning: This is a significant risk for your guarantor. It can damage their credit score and your relationship if you fail to make payments.

3. Specialist Lenders

There are many reputable credit providers in South Africa who are registered with the National Credit Regulator (NCR) and specialize in loans for individuals with poor credit records. They understand the market and have different risk assessment models than traditional banks.

• How to find them: Always verify that a lender is registered by checking the public database on the NCR website.

Red Flags: How to Spot a Predatory Loan Shark

When you’re desperate, you are vulnerable to scams. Protect yourself by learning to spot the warning signs of an illegal lender (a “mashonisa” or loan shark):

• They demand upfront fees. A legitimate lender will never ask you to pay a fee before your loan is approved and paid out.
• They are not registered with the NCR. This is the biggest red flag. If they aren’t on the NCR database, they are operating illegally.
• They ask to keep your ID book, passport, or bank cards. This is illegal and is used to intimidate you.
• Their contracts are vague, or they have no physical address. Legitimate businesses have clear terms and traceable locations.

If you see any of these signs, walk away immediately.

The Comeback Plan: How to Start Rebuilding Your Credit

Getting a loan is a short-term fix. Rebuilding your credit is the long-term solution.

1. Pay Your Bills on Time: Even small accounts like a clothing store card or a mobile phone contract. Every on-time payment helps.
2. Dispute Errors: If you found any mistakes on your free credit report, formally dispute them with the credit bureau.
3. Settle Old Debts: Try to negotiate settlement amounts on old, defaulted accounts and ensure you get a paid-up letter once done.
4. Use Credit Responsibly: If you do have a credit card, keep your balance low and pay it off every month.

Conclusion

Being “blacklisted” is a myth, but a poor credit record is a real challenge. However, it is not a permanent state. By understanding your true financial picture, knowing your legitimate options, and taking small, consistent steps to rebuild, you can take back control.

Forget the myth of the blacklist. Focus on the reality of your comeback.