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Responsible Lending Policy

Loan Buddy Responsible Lending Policy

At Loan Buddy, we are committed to responsible lending practices that put your financial well-being first. Our goal is to offer financial support that helps you without placing unnecessary strain on your finances. We encourage customers to make informed borrowing decisions and avoid taking on more debt than they need.

  1. Transparency in Lending

We believe that borrowing should be simple, clear, and free of surprises. That’s why we:

  • Provide a full breakdown of your loan costs upfront, including interest rates, service fees, and repayment amounts. Everything is clear before you commit.
  • Ensure straightforward agreements: All loan agreements are clear and simple, without hidden clauses or fine print.
  • Offer personalised loans: Loan amounts and repayment terms are tailored to your financial situation, so you only borrow what you can afford and comfortably repay.
  1. Credit Assessment

We care about your financial health, which is why we ensure every loan is affordable and manageable:

  • We conduct credit checks to assess your debt repayment history, existing debt obligations and your ability to repay the loan you have applied for. We only lend to customers who demonstrate financial stability and the capacity to meet their loan obligations .
  • We perform affordability assessments to ensure the loan amount aligns with your income and expenses. Our goal is to help you avoid taking on debt that could lead to financial stress and over-indebtedness.
  1. Short-Term, Flexible Loans

Our loans are designed to offer flexibility without burdening you with long-term debt:

  • Borrow up to R7000—because 7 is our lucky number, and it could be yours too! Choose a repayment period that fits your budget, with options up to 6 months.The loan amount applied for will be subject to your affordability assessment indicating that you can afford the loan installment.  If you do not qualify for the loan amount you want, we will advise you what amount you can qualify for.
  • Repay early with no penalties. Settle your loan ahead of schedule and save on interest.
  1. Responsible Customer Engagement

At Loan Buddy, we encourage customers to:

  • Borrow only what is necessary: Avoid taking on more debt than you need. We’re here to support you with responsible borrowing.
  • Reach out if you’re struggling: If you’re having trouble repaying, contact us immediately. We’ll work with you to find a solution that minimizes financial stress.
  • Understand the terms: Ensure you fully understand the loan terms and your repayment obligations before applying.
  1. Ethical Practices and Credit Bureau Reporting

We adhere to ethical lending practices, ensuring that every loan is responsible and sustainable:

  • We do not offer loans to individuals who cannot afford them. We assess each loan to ensure it’s in your best interest.
  • For first-time borrowers, we limit the loan amount to help build a responsible borrowing history.
  • We report your repayments to credit bureaus, helping you build or improve your credit score. Timely repayments can improve your financial future, while missed payments can negatively impact your credit standing.
  1. Support and Guidance

If at any point you feel overwhelmed or need guidance on your loan, we’re here to help:

  • Our support team is ready to assist and provide financial guidance.
  • If you face difficulties, we’ll work with you to find the best way forward, ensuring your financial journey stays on track.

Loan Buddy is regulated under the National Credit Act (NCA), ensuring that all our lending practices meet South African legal and consumer protection standards. We are committed to responsible lending, transparency, and supporting your financial health.