1. Dummies Guide to the NCA © 2006 WW Bayliss Dated:20/10/2006 Version:1.1 ( Draft )

2. Chapter 1 Interpretation, purpose and application Part A: Interpretation Chapter 2 Consumer Credit Institutions Part A: National Credit Regulator Chapter 3 Consumer Industry Regulation Part B: Compliance procedures and cancellation of registration Chapter 4 Consumer Credit Policy Part A: Consumer Rights Chapter 5 Consumer Credit Agreements Part A: Unlawful agreements and provisions Part B: Purpose and application Part C: Categories and Classification of Credit Agreements Part B: Confidentiality, personal information and consumer credit records Part C: Credit Marketing Practice Part D: Over-Indebtedness and reckless credit Part B: Disclosure, form and effect of credit agreements Part C: Consumer’s liability, interest, charges and fees Part D: Statement of Account Part E: Alteration of credit agreements Part F: Rescission and termination of credit agreements Chapter 6 Collections, payments, surrender and debt enforcement Chapter 7 Dispute settlement other than debt reinforcement Part A: Alternative dispute resolution Part B: Initiating complaints or applications Part C: Informal resolution or investigation of complaints Part D: Tribunal considerations of complaints, applications and referrals Part E: Tribunal orders Part B: National Consumer Tribunal Part C: Administrative Matter Part D: National and provincial co-operation Part A: Registration requirements, criteria and procedures Chapter 8 Enforcement of the act Part A: Searches Part B: Offences Part C: Miscellaneous matters Chapter 9 General provisions     S89(2)(b); 90(2)(o) Jun06 Sep06 Jun07 Part A: Collection and repayment practicesJun07 Part B: Surrender of goodsJun07 Part C: Debt enforcement by repossession or judgmentJun07 Admin. Matters Group Admin. Matters DRAC CCS/P 2 Chapter LinksChapter DetailApply to T3 Juristic Sections not applicable Effective dates ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔

3. What is the legal status of the client? Natural Person Juristic Person All sections are applicable Does the client’s asset value OR annual turnover, at the time of the agreement, exceeds R1,000,000? Yes Is the juristic person the State or an Organ of State? Limited sections are applicable Is the credit agreement a large agreement? Note: A credit agreement is a large agreement if it is a mortgage or any other credit transactions, except a pawn transaction, or credit guarantee, and the principle debt falls at or above the high thres- hold, i,.e. R250,000 No Is the credit agreement at arm’s length? No Applicable sections C3 Registration and Licensing Reg.req., procedures; compliance procedures C4 Consumer Credit Policy Consumer rights; Confidentiality, information, records C5 Consumer Credit Agreements Unlawful agreements; Disclosure; Statement of Account; Alteration of agreements; Termination of agreements C6 Collection, Debt Enforcement,,etc. C7 Disputes Sections not applicable C4 Part C&D Credit Marketing Practices Over-indebtness & Reckless Credit C5 S89 (2)(b) Unlawfulness of negative option marketing S90(2)(o) Unlawfulness ito variable interest rate statement C5 Part C Consumer liability, fees, charges and interest Yes No The Act is not applicable on credit agreement Note: in any of the following arrangements, the parties are not dealing at arm’s length: (i) a shareholder loan or other credit agreement between a juristic person, as consumer, and a person who has a controlling interest in that juristic person, as credit provider; (ii) a loan to a shareholder or other credit agreement between a juristic person, as credit provider, and a person who has a controlling interest in that juristic person, as consumer; (iii) a credit agreement between natural persons who are in a familial relationship and— (aa) are co-dependent on each other; or (bb) one is dependent upon the other; and (iv) any other arrangement— (aa) in which each party is not independent of the other and consequently does not necessarily strive to obtain the utmost possible advantage out of the transaction; or (bb) that is of a type that has been held in law to be between parties who are not dealing at arm’s length; Business area is out-of-scope Business area is in-scope Business area is in-scope, with limited application START Based on limited application, determine generic GSF functions & BBS specific functions (process tbc.) No sections are applicable Yes No Chapter 1 Interpretation, purpose and application Part B: Purpose and Application 3

4. Chapter 1 Interpretation, purpose and application Part C: Categories and Classification of Credit Agreements Credit Agreements (CA) S8 Categories S9 Development Credit Agreements S10 Public Interest Credit Agreements S11 Classification Credit Facility (CF) S8(3) Credit Transaction (CT) S8(4) Credit Guarantee (CG) S8(5) CP has a suppl. reg. certificate CA is between co-op as CP and a member of the co-op Profit is not the dominant factor for CA CA is a educational loan CA is for developing a small business CA is ito low income housing Max principle debt CA entered in spec circumstances, purposes and period Minister promote availability of credit Spec circumstance: Natural disasters or similar emergent and grave public interest Exempt ito Reckless Credit provisions CP supplies Goods & Services (g&s) Pay amount to or on behalf of consumer Defer consumer’s obligation ito g&s or repay amount to CP Bill consumer with any part of cost of g&s or amount Charges, interest and fees are payable on any amount deferred or billed and not paid in time to the CP CP supplies Goods & Services (g&s) Pay amount to or on behalf of consumer Defer consumer’s obligation ito g&s or repay amount to CP Bill consumer with any part of cost of g&s or amount Charges, interest and fees are payable on any amount deferred or billed and not paid in time to the CP Person promise to satisfy, upon demand, the obligations of another person ito a CF/CT If CA is a CF and CT, provisions ito CF and mortgage agreement reside Ito S108, it is a CF Ito S4(1)(b) it is a large agreement if a mortgage agreement Large Small Intermediate Pawn transaction CT if limit <R15,000 Any CT or CG if principle debt <R15,000 Excl. Mortgage agreement CF if limit >R15,000 Any CT or CG >R15,000 <R250,000 Excl. Pawn transaction and Mortgage agreement Mortgage agreement Any CT or CG >R250,000 Excl. Pawn transaction 4

5. Chapter 4 Consumer Credit Policy Part A: Consumer Rights Consumer Rights Protection of Consumer Rights S66 Protection against Discrimination S61 Information in official language S63&64 Apply for Credit S60 To reason refusal S62 Receive Documentation S65 Natural and juristic person has right to apply CP may refuse to enter or provide credit Basis for refusal should be reasonable commercial ground which is consistent with customary risk management and underwriting practices Noting compels a CP to enter into CA’s Unfair discrimination is prohibited also ito natural persons within a juristic person as consumer Specifically not ito: Ability to meet obligations Decision to provide credit Determining cost Proposing T&C Assessing compliance with the terms of the CA Exercising a CP right ito the Act Decisions ito termination Reporting credit information No prohibition to discriminate against age CP may use evaluative model/ mechanism in assessing/ managing/ pricing risk May not use statistical base where risk categorisation/ differentiation is ground for unfair discrimination CP must disclosure reasons for- refusal to enter CA offering lower limit as applied for (new/existing) refusal to increase limit refusal to renew expired facilities If decision is based on adverse credit information from bureau, CP must disclose name, address, contact Tribunal my limit CP obligations if consumer’s request is vexatious and frivolous Documentation ito the Act need to be in consumers official language However, take cognisance of usage, practicality, expenses, needs of the residing population, regional circumstances CP must at least honor two official languages Focus can be national or provincial Docs must be in prescribed form and in plain language for average literate consumers Not applicable to Developmental Credit NCR must balance CP efficiency and principles of S64 Docs must be in prescribed form Submission via f-t-f, fax, e-mail, printable webpage Submission need to be ito consumer preference No original copy fee may be charged Upon written request, CP must provide- Replacement copy of any document at no cost (within 1-year), else search and production fees (as per reg.) Tribunal my limit CP obligations if consumer’s request is vexatious and frivolous Not applicable to Developmental Credit Where consumer exercise a right, CP may not- discriminate directly or indirectly penalise the consumer change the T&C to the detriment of the consumer actions to accelerate/ enforce/ etc. termination  If CA is determined unlawful, CP may not- penalise another party to the CA alter T&C commence with actions to accelerate/ enforce/ etc. termination 5

6. Chapter 4 Consumer Credit Policy Part B: Confidentiality, personal information and consumer credit records Confidentiality Verification and Removal of credit info. S73 National Register of CA S69 Records ito debt adj. or judgment S71 Right to Confidential Treatment S68 Credit Bureau Information S70 Right to access/ challenge records S72 All confidential client information needs to be protected Info may only be used for purposes of the Act Info may only be disclosed to the consumer or as per instruction, as permitted by the Act or by Tribunal Its an offence by the Credit Bureau if they fail to comply with the S55 notice NCR to maintain register of all outstanding CA When CP enters or amends CA, info should be submitted to the NCR or CB Spec info required (refer S69(2)ito CA and transfer details CB must also submit info to the CP Consumer Credit Information is defined in S70 A CB must accept and file all info received from CP (with fees which Minister can cap) without charge, accept info from the client verify the information obtained and recorded retain info for prescribed period maintain records delete any information not prescribed issue reports (as prescribed and requested) not issue a negative perception about a consumers information not report incorrect information NCR will monitor credit market to identify patterns of reckless lending, over-indebtedness, etc. NCR may therefore request CB to issue periodic synopsis reports and relevant information Where consumer's debt has been re-arranged, he may apply for clearance certificate Ito certificate application, Debt Councilor (DC) must investigate debt-arrangement circumstances, an i. issue the certificate or refuse issuing If refused, consumer may appeal at Tribunal If issued, consumer may file copy with the NCR CB must upon receipt delete any record relating to defaults Every person has a right to be notified about info reported to the CB Can inspect any record recorded at the CB (charges depending on time and type of info investigated Can challenge the accuracy of info and may request the CB to investigate accuracy Can be compensated for incorrect information reported in terms of cost for correcting the info CP may not request client to furnish CB report ito CA application Where CB info was challenged, CN must seek evidence ito the challenge This info must be shared with the consumer or use to correct information recorded by the CB Within 20 business days, consumer may lodge a complaint Minister must prescribed verification and review of info with CB 6

7. Chapter 4 Consumer Credit Policy Part C: Credit Marketing Practice Negative option marketing S74 Marketing/ sales at home/ office S75 Advertising Practices S76 Required marketing information S77 Marketing CP may not harass a person to enter a CA CP may not enter a private dwelling unless pre-arranged, part of g&s delivery incidentally providing credit as prescribed CP may not enter a consumer’s place of work unless to enter a CA with the employer arranged between CP, employer and union Invited by the person visited Arranging entities may not be reimbursed for arranging entrance to the CP Does not apply to advertisement - that does not make reference to a spec. CP/ product where dominant purpose is to promote responsible credit or use of credit in general that promote a spec. CP/ product without any ref to spec price, cots, etc. by the seller of g&s indicating the person is prepared to accept credit as payment Applies to the CP as well as seller of g&s for purchases on credit An advertisement – must not be misleading, deceptive, etc. must not advertise a form of credit that is unlawful must not contain any prohibited statement may contain comparative credit costs where cost, fees, etc per alternative is shown  CP must set out interest rate and other costs  Not applicable to Developmental Credit In terms of solicitation, CP must include a statement with prescribed information for the particular solicitation particulars CP may not offer to enter a CA increase a facilities limit amend a CA on basis that the action will automatically come into effect unless consumer declines the offer Such CA will be unlawful CP must provide consumer with a statement of options and provide consumer with opportunity to select an option, i.e. decline to be excluded from campaigns and marketing listings no e-mails, SMS’s, etc.  CP must maintain a register of option selected and may not contravene an option selected 7

8. Chapter 4 Consumer Credit Policy Part D: Over-indebtedness and reckless credit Obligation re-arrange- ment S87 Over- Indebtedness S79 Prevention of reckless credit S81 Declared/ relieved over- indebtedness S85 Over-indebted/ Reckless Lending Application for debt review S86 Reckless credit S80 Effect of re- arrangement/ debt review S88 Application & Interpretation S78 Suspension effect S84 Assessment mechanisms/ procedures S82 Suspension of reckless credit S83 Not applicable where the consumer is a juristic person Not applicable (in terms of reckless credit) ito a temporary increase in credit limit under a credit facility Over-indebted = the preponderance of available information at the time a determination is made indicates that the consumer is or will be unable to satisfy in a timely manner all obligations under all the CA to which the consumer is a party. Include consumer’s financial means/ obligations and probable propensity to satisfy obligations (based on debt repayment history). Value of CF = settlement value Value of CG = settlement value of CA Reckless = at time of agreement/ increase CP did not conduct an assessment or CP entered into CA despite the fact that consumer does not understand pros&cons of CA or CA will create over-indebtedness CP must discard ability of consumer to meet obligations or understanding pro& cons Value of CF = settlement value Value of pre-existing CG = settlement value of CA Value of new CG = settlement value of CA Consumer must answer all information requests CP may not enter into CA before assessing– understanding of pros&cons and rights & obligations debt repayment history existing financial means/ obligations on a reasonable basis that any commercial purpose may prove to be successful Defense ito reckless credit allegation if – CP finds that consumer failed to furnish information Court/ Tribunal decision that consumer failure prohibited CP assessment CP determines fair & objective eval.mechanism/ model/ proc. for assessment NCR may pre-approve methodology ito Dev.Credit and publish guidelines (not binding) Tribunal may force CP to use guidelines or industry practice Court may declare CA as reckless May set aside all/ part of consumer’s rights & obligations or suspend CA If reckless, court must determine over-indebtedness If over-indebted, court may suspend or restructure obligations Before making an order, court must consider – ability to meet CA obligations expected date CA obligation will be met Consumer is not required to make any payment No fees may be charged CP rights are unenforceable After suspension all CP rights are enforceable No fees recuperation is permissible If over-indebted, court may – refer to debt councilor for recommendation to court declare consumer over-indebted make an order to relief over-indebtedness Consumer may apply for over-indebtedness Does not apply where CP has enforce the CA (S129) Debt councilor (DC) may request appl fee but may not accept fee from CP DC must notify all CP’s and CB’s (relevant) Consumer and CP must comply with DC requests and participate in good faith in review DC must determine of consumer appears over- indebted and CA seems to be reckless If not over-indebted, appl must be rejected. Consumer may apply to court If not over-indebted, but will not be able to meet obligations, voluntary re-arrangement is to be recommended If accepted, DC must record proposal. If not, refer to court If over-indebted, may recommend order for reckless credit, if reckless OR re-arrangement (i.e. period extension, date postponement, re-calculate obligations During review, If consumer is in default, CP must issue notice to terminate review (timeline: 60 days after debt review appl) Court may order resuming at any time Court may reject appl for re-arrangement Order a CA reckless Order re-arrangement of obligations NCR may not intervene in proceedings Consumer may not enter into new CA or increase CF other than consolidation agreement Unless where– DC rejects appl OR court rejects DC recommendation OR consumer application all obligations have been met ito voluntary negotiations between CP and consumer OR consolidated agreement  Where CP receives notice, Cp may not institute litigation or enforce any right until consumer is in default, appl has been rejected OR consumer default in terms of a re-arrangement  If CP enters into CP while a re-arrangement exists, that CA is reckless 8

9. Chapter 5 Consumer Credit Agreements Part A: Unlawful Agreements and Provisions Unlawful Credit Agreements S89 Unlawful Provisions S90 Supplementary Docs & Req. S91 Unlawful Credit Unlawful CA = consumer was unemancipated minor unassisted by guardian consumer was mentally unfit (CP must have had reasonable knowledge) in an administrative order, administrator did not consent (CP must have had reasonable knowledge) ( CA is not unlawful if consumer directly or indirectly by an act or omission induced CP to believe he (the consumer) has legal capacity OR suppress the fact that consumer is under order ) CA results due to negative option marketing Supplementary agreement or document prohibited ito S91(a) CP was not registered ( CA is not unlawful if appl was submitted to NCR or CP holds a clearance certificate ) Notice by NCR that CP may not offer or extend credit  If CA is unlawful, court must order that – CA is void from date of CA CP must repay all money + interest (calculated as per CA) all CP rights are cancelled or forfeited to the State IF court finds that canceling rights would unjustly benefit the consumer CA may not portray unlawful provision Unlawful provision = Defeat Act’s purpose, deceive customer or subject to customer to fraudulent conduct Directly or indirectly purports to authorise CP to satisfy obligation by making a charge against an asset of the consumer, expedite a particular CP’s payments, appoint CP as and consumer’s agent, exempt CP liability, make a supplementary agreement conditional, waive or deprive a client right or common law, avoid a CP obligation, set aside any provision, authorise the CP to be unlawful or do something required provisions results from a negative option marketing action Express a consumer acknowledgement that no representation or warranties were made before CA is entered into OR that g&s were received when they were not received Express an agreement to deposit any bank-related devices, provide a PIN to access an account, forfeit money to CP is consumer exercise rescission rights OR fails to comply with CA before g&s services are rendered Expresses on behalf of the consumer a CP authorisation to enter premises and reposes g&s, a grant of POA, undertaking to advance-sign docs, consent for pre-determined value of cost ito enforcement, limitation of CP liabilities States that interest rate is variable, except permitted by S103(4)  If unlawful, provision is void from date of provision  If unlawful, court must serve it as unlawful, amend to be lawful, declare the entire CA as unlawful  Minister may prescribe common law rights not to be waived CP must not – may not require or induce a customer to enter into a supplementary CA require a customer to sign a document containing an unlawful provision request a customer to give the CP possession of a device, etc except to make a copy or I&V reveal a PIN 9

10. Chapter 5 Consumer Credit Agreements Part B: Disclosure, Form and Effect of Credit Agreement CA ito substituted goods S98 Form of Credit Agreement S93 Changes, waivers or deferrals S95 Quote and Agreement Disclosure of location of goods S97 Liability for lost/ stolen devices S94 Pre- agreement Disclosure S92 Address for Notice S96 Ito Small CA, CP must give pre-agreement statement and quotation Ito Intermediate or Large CA, CP must give pre- agreement statement in the form of proposed agreement taking account of S93 AND a quotation setting out the- principle debt proposed amount distribution interest rate and other costs total CA costs costs ito rescission Ito Small CA, for 5 business days, the CP must enter into the CA on customer request at or below rate and costs quoted ito Intermediate or large CA, for 5 business days, the CP must into the CA on customer request at or below rate and costs quoted OR at a higher rate by a margin not > bank rate at quote date minus bank rate at date of agreement If credit is extended to purchase an item with limited availability, CP may state that quote is subject to continued availability of item Statement may be submitted in paper or printable electronic format Section not applicable on CP showing willingness to consider an application or enter into future CA or up to specified maximum value CP must deliver, at no cost, to consumer a doc recording their CA Intermediate and large CA must classify the type of CA Where a device is connected to a CF, the CA must disclose a number to report stolen/ lost devices CP may not impose liability for use of CF after device has been reported UNLESS consumer signature evidence use of CF OR CP has other proof that consumer is authorised Credit provision as result of change of an existing CA deferred or waived amount under an existing CA is not to be treated as a new CA Ito legal notice parties must deliver docs at the address of the other party as per the CA Address may be changed via written notice This section applies to a CA if it concerns g&s, the CP is the title owner and CP has right to possess the goods Consumer must notify CP of change in address, address where goods are kept, name and address of person to whom possession has been transferred False or misleading consumer information OR impedes a CP rights, is an offence Ito substituted goods, the CA applies to the date of substitution CA needs to be amended describing the substituted goods 10

11. Chapter 5 Consumer Credit Agreements Part C: Consumer liability, interest, charges and fees Credit Insurance S106 Cost of Credit S101 Interest S103 Cost of Credit Maximum Costs S105 Fees and Charges S102 Prohibited Charges S100 Changes to Costs S104 CP may not charge an amount ito a credit fee/ charge prohibited amount/ fee exceeding the allowable amount/ threshold interest amount exceeding the allowable amount/ threshold any cost to a 3 rd party ito a CA other than S102 provisions CA must not require payment, except but not exceeding theshold- principle debt initiation fee and aligned with establishing a new CA service fee and may be charged monthly or annually (except for CF which in addition can be charges on a transaction basis) interest expressed as annual % cost of credit insurance default admin charges only ito a defaulted customer collection cost  If one CA is amended by a new CA, initiated fee may be charged  If CF is linked to FSA, any service charge ito the FSA, is subject to threshold if charge was levied with or without CF, otherwise exempt from threshold Following costs can be included ito IA, MA, SL or a lease. initiation fee, if offered separately to consumer cost of extended warranty agreement delivery, installation and fueling charges connection fees taxes, licenses and registration costs credit insurance premiums subject to S106 CP must not – charge a cost if consumer does not want the service or mandate the CP to act on his behalf require the customer to appoint the CP as agent charge excessive amounts above fair market value or threshold  If CP payment to 3 rd party is not ascertainable when consumer pays costs < consumer costs paid, Cp must refund customer the difference Interest rate on defaulted CA may not exceed maximum rate on any part of principle debt subject to S103(5) CA may provide for rate to become payable at any time after the day it applies CP must not charge rate before this day CA may apply a varied rate only by fixed relationship to a reference rate stipulated in the CA Reference rate must be similar to rate used by CP Aggregated credit costs accruing in default may not exceed the unpaid balance of principle debt Minister may prescribe interest calculations Variable rate provisions do not apply to Dev CA CP may not unilaterally increase – service fees or calculation method rate if interest except ito variable rates CP must notify customer with 5 days notice of any change concerning – rate of interest credit fee or charge payment frequency of a fee or charge Ito variable interest rate, CP must notify customer no later than 30-days after the change has been affected. CP must set out new rate or if rate is determine by reference rate, the new reference rate Minister may prescribe method for calculating maximum interest rate AND fees Minister must consider making credit available, credit market conditions, cost of credit and social impact on low income customers Ito regulations, Minister must determine different maximums and calculation method CP may require Credit Life Insurance (CLI) Insurance may not > total of outstanding obligations Ito MA, CP may require insurance ito immovable property not > asset value of property Ito any other case, CP may require insurance cover against damage or loss not > total outstanding obligations CP must not demand or offer insurance that is unreasonable and at unreasonable cost CP may offer optional insurance If CP proposed purchase of a particular policy, consumer can waive proposal, substitute with his own policy In terms of a proposed policy, the CP may not add charges, must disclose insurance cost and any income received by the CP, explain the T&C, provide a copy of the policy and the CP to be a loss payee up to settlement value at the occurrence of an insured contingency only If accepted, premiums must be charge monthly for Small CA and monthly or annually for intermediate and large CA (If annually, the premium must be recovered in the same year) If paid annually, consumer must be reimbursed pro-rate if settle in theyear If not, consumer can be requested to furnish a payment direction on behalf of the consumer AND loss payee direction to the other insurer 11

12. Tribunal Orders S114 Statement of Account S108 Statement of amount owing S110 Dating and adjustment of debits and credits S112 Statements Statement of settlement account S113 Form and content S109 Statement Disputes S115 Limited Application S107 Disputed entries in accounts S111 Does not apply to a non-recalled CG and Dev CA Ito joint consumer, statement to be given to one of them. Other may request copy at no charge Do not apply to pawn or discounted transactions until first interest is charged CP must offer to deliver periodic statements Maximum period between issuing is 1 mnth, 2 mnths for IA, lease and SL and 6 mnths for MA CP and consumer may negotiate frequency but not more that 3 mnths Statement need not to be delivered ito CF if no amount has been debited or credited Do not apply to pawn or discounted transactions until first interest is charged Opening (new statement) and closing balances (previous statement) need to correspond For intermediate and large CA statement must include types of CA Minister may prescribe guidelines Do not apply to pawn or discounted transactions until first interest is charged On request, CP must deliver a statement for the following: current balance amount credited or debited amount overdue amount payable To be delivered in 10 business days for request in terms of 1 year, 20 business days for period more than 1 year May be delivered orally, in person or via phone, letter or electronic media Not to be provided after 3-years of account closure If consumer’s request is vexatious, Tribunal may reject request Consumer may dispute via written notice CP must respond via written notice explaining the statement entry in detail, confirming error and revise entry CP must not enforce proceedings based on default due to disputed entry until CP has explained the entry/ confirm the error OR if the matter is under alternative dispute resolution procedures OR before Tribunal Debit to take effect on date of incurrence Credit to take effect on payment or earns right to have account credited CP may adjust debits and credits to reflect the legal obligations of the consumer and the CP At request, CP must deliver, at no cost, statement of the settlement value of a CA as calculated ito S125 To be delivered in 5 business days May be delivered orally, in person or via phone, letter or electronic media Is binding 5 business days after delivery except for a CF where credits were made to the account after the date the statement was prepared If consumer’s request is vexatious, Tribunal may reject request Tribunal may order to furnish statement to consumer in time frames prescribed Determine amounts irt which the consumer was sought Where a consumer’s dispute ito statement entry is not resolved, the Tribunal could be contacted If error on statement, Tribunal could order CP to correct the mistake and hence the statement Chapter 5 Consumer Credit Agreements Part D: Statement of Account 12

13. Chapter 5 Consumer Credit Agreements Part E: Alteration of Credit Agreements Unilateral changes by CP S120 Changes by agreement S117 Increase of CF limit S119 Alterations Reduction to CF limit S118 Alteration of original or amended CA S116 Any change/ amendment to a document recording a CA, after signed by/ delivered to a consumer, is VOID unless – change reduces liability consumers signs in margin opposite the change change is recorded in writing and signed by all parties oral change is recorded and reduced to writing If parties agree to change, CP must within 20 business days after CA, deliver to consumer a document that- reflects their amended agreement complies with S93 (Form of CA) This action does not apply to an increase/ decrease to CF limit A consumer may ito a CF require the CP to reduce the limit AND stipulate a maximum limit CP must give written confirmation of the new limit and effective date (not to be more than 30 business days after instruction) CP may reduce a limit via written notice to the consumer When I new limit takes effect, if the settlement value of the CF is higher than the new limit, CP must not treat that excess as over-extension of credit for calculating minimum repayment CP may not ask fee for reducing limits CP may increase CF limit, only – temporarily (if CP honours an instrument issued by consumer despite the fact that the debt is higher than the credit limit OR CP raise the limit based on consumer request in order to do a specific transaction on condition that the preceding limit will apply again after the transaction or specified occurrence) by agreement with the consumer in response to consumer request OR with consent of consumer ito written CP proposal ( CP must complete fresh assessment ito consumer’s ability to meet obligations ) unilaterally (if requested and consented by the consumer ito automatic increases) (CP may automatic increases limit (i) once during the year as measured from the later of the CF effective date or the most recent limit amendment date, (ii) by an amount not > the lesser of aver mnthly purchase or advance OR aver mnthly payment during the 12 mnths preceding the increase date)  A specific request ito automatic increases does not include an oral request, assent or a standard provision of a CA  A specific request ito automatic increase does include a written request or a td form option  When limit is increase, any other amendment to the CA must comply with S93 and S117  An limit increase ito consent is not unlawful wrt negative option marketing A Cp may not unilaterally change the period for repayment (except to lengthen it) OR manner of calculating the minimum payment CP must give consumer 5 business days notice of an unilateral change and the details of the change 13

14. Consumer’s rights to rescind S121 When may consumer terminate? S122 Termination by CP S123 Cancellation of Credit Applies only to a lease or IA entered into off-site Consumer may cancel CA within 5 business days by – delivering a notice to the CP tendering g&s or payment in full When terminated the CP – must refund consumer any money paid within 7 business days after termination notice may require payment from consumer for reasonable cost for dealing with returned goods AND reasonable rent for the goods while in possession of the consumer unless in original packaging upon return to CP  CP may apply to court ito unsuccessful depreciation negotiations with the consumer  Court may, subject to fair market value depreciation order consumer to pay CP on condition the amount is not > than the difference between the depreciation at fair market value and the amount the CP is entitled to charge, i..e reasonable costs (refer note above) Consumer may terminate by paying settlement value in accordance with S125 Consumer may terminate a IA, SL or lease of moveable property by surrendering goods to the CP OR paying any required amount ito S127(7) A CP may terminate CA If consumer is in default, CP may take steps (refer Pc;C6) and enforce and terminate the CA Ito a CF, the CP may – suspend the CF close the CF by giving notice to the consumer at least 10 business days prior to closure A CF remains effective until consumer has paid all amounts lawfully charged to the account CP may not close or terminate a CF solely on the grounds that – CP declined consumer’s request to increase limit Consumer declined CP proposal to increase limit Consumer requested reduction in limit, unless reduction level falls below a level the CP offer customarily offer a CF the devices have expired  Unilateral termination by CP does not suspend any residual obligations of the CP to the consumer Chapter 5 Consumer Credit Agreements Part F: Rescission and termination 14