JHB High Court ruling to stop banks from taking money without consumer’s permission

Jhb High Court has ruled that banks can no longer take money from consumer’s account without their permission.


A recent Johannesburg High Court ruling has put an end to banks taking money without their client’s consent. On 27 June the National Credit Regulator (NCR) won a long battle against Standard Bank at the High Court.

The High Court ruled that it was unlawful for the bank to take a client’s money without their consent. The NCR was pleased with the High Court’s ruling. This was according to the Chief Executive Officer (CEO) of the NCR, Nomsa Motshegare.

“The NCR welcomes this judgment as it protects consumers from financial difficulties caused by the arbitrary transfer of funds from their accounts by banks.”

Court bid against Standard Bank

The NCR launched a court bid in 2016 after receiving many complaints from consumers. This was according to the Investigations and Enforcement Manager, Jacqueline Peters.

“Consumers, in these instances are left with no monies for their ordinary day to day living expenses or other debt obligations, ultimately leaving already over-indebted consumers in a far worse situation.”

Standard Bank spokesperson, Ross Linstrom, said that the bank opposes the bid.

“Our interpretation is that the common law rule of set-off can be applied because section 124 of the National Credit Act does not replace or amend this rule.”

Consumer money taken without permission

The common law set-off was used to cancel out a debt between two individuals.

Motshegare stated that banks should always gain the consumer’s permission before transferring money out of the consumer’s account.

“Banks should obtain permission from consumers before transferring funds from consumers’ accounts to pay amounts due under credit agreements.”