Landmark Court Ruling: Pawn Brokers Can’t Keep More Than What You Owe

Why Debt Review Is a Better Option Than Selling or Pawning Your Valuables

When money is tight, many South Africans feel forced to sell or pawn their personal belongings just to survive the month. From pawning cellphones and furniture to pawning vehicles and jewellery, countless families have handed over their most valuable items in exchange for short-term relief.

But on 8 April 2025, the Supreme Court of Appeal (SCA) handed down a game-changing judgment that brings long-overdue justice to consumers.

The Case in Brief

The case involved a typical pawn broking business, The Loan Company (Pty) Ltd, which provided short-term loans and kept consumers’ vehicles or goods as security. If a consumer missed a payment, the company sold the item and — here’s the problem — kept ALL the money, even if it far exceeded the loan amount owed.

That’s not just unethical — it’s now officially illegal.

The Judgment:

  • Pawn brokers may NOT keep the full proceeds from selling your item if the sale exceeds what you owe.

  • Any excess money must be refunded to the consumer.

  • Unregistered lenders cannot issue credit — any credit agreements with them are unlawful and void.

Example:

If you borrowed R10,000 and your car was sold for R50,000, the broker can only keep what you owe. The remaining R40,000 is YOURS — and they are legally required to pay it back.

Why This Matters

This ruling strengthens consumer protection under the National Credit Act (NCA) and holds lenders — especially pawn brokers — accountable to fair and transparent lending practices.

It also means that if you’ve recently pawned an item and suspect you were overcharged or exploited, you may be entitled to a refund.

Before You Pawn — Know Your Rights and Options

We understand the desperation that leads people to pawn their possessions. But here’s the truth: Debt review is a safer and smarter option.

Why Choose Debt Review Instead?

  • You don’t have to sell or pawn your assets.

  • Your home, car, and essential goods are protected under debt review.

  • You’ll get a reduced monthly repayment plan that suits your income.

  • Interest rates and fees are “frozen” or reduced, stopping your debt from spiraling.

  • Your credit providers can no longer harass you once you’re under review.

Don’t Let Desperation Cost You Everything

The SCA judgment is a reminder that you have rights — even in tough times. But you don’t have to wait for a legal battle to claim back what was taken from you. With debt review, you get legal protection and financial breathing space before you make decisions that can hurt you and your family long-term.

Speak to Us — Confidential, No-Obligation Assessment

If you’re drowning in debt and thinking about pawning your belongings just to get through the month — pause.

Let’s talk. We’ll help you understand your options, starting with a free debt assessment.

📞 Call or WhatsApp us on 061 432 8499
🌐 Visit www.dcgsa.co.za
✉️ Email us at help@dcgsa.co.za

Remember

Pawning is temporary. Debt review is a long-term solution.
You don’t have to lose your assets to gain your financial freedom.

DCGsa – Empowering South Africans to live debt-free with dignity and protection under the law.