Standards
Standards
What the Association expects of the organisations and practitioners in this market — written as things a reader can check rather than values a brochure can claim. These are published expectations, not law, and the page says plainly what happens when one is not met.
Adopted
Adopted by the founding members on 17 September 2026 under the Association’s constitution (PLA-GOV-001), and maintained under it. Amendments are recorded with the date of the resolution that made them.
PLA-STD-001 · version 1.1 · 36 rules across 3 sections · cite as “PLA-STD-001 cl 3.1.2”
What these are for
Most private-lending disputes do not start with a complicated structure. They start with a conversation in which something was not said: who the money would actually go to, what the commission was, what happens if the borrower stops paying, whether the capital can be recovered early. Each standard below exists because its absence is a recurring cause of harm.
They are written so that a reader can test them without expertise. If you cannot tell from an organisation’s own material which entity would hold your capital, it has failed the first one, and you have learned something useful in thirty seconds.
What the markings mean
- Critical
- A single established breach is grounds to suspend or withdraw a listing, whatever else is in order. Answered wrongly, this alone fails the assessment.
- Major
- Requires an explanation and a correction. An unremedied or repeated breach becomes grounds to withdraw a listing. Counts towards the pass mark. Several wrong answers fail it.
- Standard
- Expected practice. A lapse is recorded and corrected rather than sanctioned. Counts towards the pass mark.
1. Organisations
What an organisation operating in or serving this market must be able to show. These are tested against published material and documents, not against an assurance.
1.1Say what you areCritical
State the legal name, the registration number and the exact role in a transaction — platform, credit provider, administrator, issuer or adviser.
A reader should never have to work out who would actually hold their money. Where the role is unstated, it is usually because more than one is being performed.
1.2Show the registrationMajor
Where a role requires a registration, publish the number where a prospective client will see it, rather than supplying it on request.
Registration is a matter of public record. An organisation that treats its own number as private has answered a different question from the one asked.
1.3Describe the risk as prominently as the returnCritical
Any material quoting a rate also states what the capital is exposed to, what happens if a borrower does not pay, and on what the return of capital depends.
Risk disclosed in an annexure to a document nobody reaches has been disclosed to nobody. Prominence is part of the disclosure, not separate from it.
1.4Never describe a return as guaranteedCritical
The words guaranteed, risk-free, secure and capital-protected are not used about private lending, in any material, at any time.
A fixed rate is a price, not a promise that capital comes back. This is the single misrepresentation that precedes most of the losses this market produces.
1.5Disclose what you are paidCritical
Disclose fees, commissions and who pays them in writing on request, and disclose the existence of a commission before an introduction rather than after it.
A commission disclosed after the introduction has already influenced the introduction it was meant to qualify.
1.6Put it in writingMajor
A prospective lender may keep the agreement, the risk disclosure and the answers they were given.
An organisation that will show documents but not release them has arranged matters so that nothing it said can be checked later.
1.7Verify identity where it appliesMajor
Where the organisation is an accountable institution, apply risk-based customer due diligence under FICA, and tell the client what is being asked for and why.
An unexplained absence of identity checks where they should apply is one of the more reliable signals that something else is wrong.
1.8Provide a complaints route a person can useMajor
Publish a named channel, acknowledge what arrives, and keep a record of the outcome.
An unmonitored inbox converts every complaint into a loss the complainant absorbs alone.
1.9Answer for your representativesMajor
An organisation is answerable for what its employees, agents and introducers say about its arrangements, and monitors what is being said in its name.
Most misrepresentation happens one layer below the person who signed anything. An organisation that disclaims what its own distribution says has disclaimed the part that reaches the lender.
2. Practitioners — the core
The core that binds every practitioner, whatever the role. The annexure for the work actually done applies in addition to this section, never instead of it.
2.1Stay inside the roleCritical
A title, Association membership or a directory listing does not authorise the provision of regulated financial advice or intermediary services. Where a regulated service is given, say under which authorised financial services provider and mandate you act.
Acting outside an authorisation exposes the client to an arrangement with no regulatory recourse behind it, and they will usually not discover this until they need the recourse.
2.2Be competent for the workMajor
Hold the training, qualification or professional standing the role actually requires, and decline work outside it.
The harm from work taken on beyond competence falls on the person who relied on it, not on the person who accepted it.
2.3Explain what can go wrong, unpromptedCritical
Raise illiquidity, credit risk, ranking, what happens on default and what the return of capital depends on, without waiting to be asked.
A reader who does not know the vocabulary cannot ask the question. Waiting to be asked is a way of not disclosing while appearing to.
2.4Disclose interestsCritical
Disclose anything that would affect the judgement being exercised, or that the person relying on it would want to know.
The test is what the person relying on the judgement would want to know, not what the person exercising it considers material.
2.5Never rush a decisionCritical
No closing dates, no limited allocations, no rate that expires this week.
Urgency is a sales device, and in this market it is a warning sign. It exists to prevent the checks a careful person would otherwise run.
2.6Keep recordsStandard
Keep a record of what was shown, what was said and what was sent, so that a disputed conversation can be reconstructed.
Without a record a dispute is decided on whose account is more confident, which is not the same as whose account is correct.
2.7Cooperate with a complaintMajor
Respond to the organisation that contracts you, and to the Association where a record is in question.
A register is only as good as the willingness of its entries to be checked.
2.8Stay currentMajor
Keep up to date with the law and market practice the role depends on, and be able to show how.
The National Credit Act, FICA and POPIA positions that govern this work move. A practitioner working from the position as it stood when they qualified is giving accurate answers to a question that has changed, and this is what a periodic reassessment exists to test.
Role annexures
The core is then extended by the annexure for the role. Commission disclosure and suitability sit in the origination annexure because that is where they apply — a security trustee, an auditor and a servicer are not commissioned introducers, and rules written for introducers describe none of their work. A practitioner holding several roles is bound by each annexure that applies.
3.1 Origination, distribution and advice
Originators, introducers, brokers, consultants, advisers.
3.1.1Critical
Disclose the commission before the introduction, in plain terms, including who pays it and on what.
Payment for placing business is the interest most likely to bend a recommendation, and it bends it at the moment of introduction.
3.1.2Major
Circumstances first, numbers second.
A practitioner who leads with a rate has skipped the part of the conversation that determines suitability, and cannot get back to it once the number is in the room.
3.1.3Critical
Do not present an arrangement as suitable without establishing the person's circumstances, or say plainly that no suitability assessment is being made.
Either the assessment was done or it was not. What causes harm is the third option: language that sounds like advice given by someone who intends to deny having given it.
3.1.4Critical
Do not describe a return as guaranteed, secure or risk-free in any formulation.
The prohibition follows the meaning rather than the words. Rephrasing it as "your capital is protected by the bond" is the same representation.
3.2 Capital and credit
Fund managers, credit analysts, issuers.
3.2.1Critical
Lend within the stated mandate, and disclose any departure from it.
The mandate is the basis on which the capital was committed. Lending outside it substitutes a risk the provider did not accept for the one they did.
3.2.2Critical
Keep capital under management separate from the firm's own money.
Commingled money cannot be traced, cannot be reliably returned and is not protected from the firm's own creditors on insolvency.
3.2.3Major
Value instruments consistently, and disclose the basis.
A valuation basis changed between reports turns a deteriorating position into a stable-looking one without anything improving.
3.2.4Major
Report to capital providers on a stated cycle, and say who audits it.
Reporting that arrives when there is good news and goes quiet otherwise is a signal in itself, and a stated cycle is what makes the silence visible.
3.2.5Critical
Do not lend capital under management to a related party without disclosing the relationship to the capital provider in advance.
Related-party lending removes the arm's-length credit assessment the provider assumed was being performed, and it is usually discovered only when the related party fails to pay.
3.3 Administration, servicing and platforms
Administrators, servicers, platform operators, security trustees.
3.3.1Critical
Separate client money from operating funds, and be able to demonstrate it.
The demonstration is the point. An assurance that money is segregated is worth nothing without the ability to show the account and the reconciliation.
3.3.2Major
Maintain records a lender can inspect, and say what happens to them if the firm stops trading.
Records that die with the firm leave a lender holding a claim they cannot evidence at exactly the moment they need to prove it.
3.3.3Major
Tell lenders when a loan falls into arrears, on a stated timetable rather than on request.
Arrears reported only when asked about are arrears the lender learns of after the point at which anything could have been done.
3.3.4Critical
Say whether loans are held in the lender's name or through a nominee, and what that means on insolvency.
This single fact decides whether a lender is an owner with an asset or a creditor in a queue, and it is rarely stated unless asked.
3.4 Professional advisers
Attorneys, accountants, auditors, tax professionals, valuers, compliance professionals.
3.4.1Major
Maintain current professional standing and indemnity cover appropriate to the work.
A professional opinion is worth what stands behind it if it turns out to be wrong.
3.4.2Critical
State clearly who engaged you — the lender or the borrower — in any report relied on by the other.
A valuation commissioned by the borrower and read by the lender is not an independent valuation, and the reader cannot tell from the document unless it says so.
3.4.3Critical
Do not provide a valuation, opinion or report for a party whose interest you also represent, without disclosing it.
The conflict does not have to change the conclusion to destroy its value as independent evidence.
3.5 Recovery and workout
Recovery specialists and enforcement practitioners.
3.5.1Critical
Act only within the authority given, and confirm it in writing.
Enforcement taken without authority exposes the lender to the counterclaim, not the practitioner.
3.5.2Critical
Comply with debt-collection and enforcement law.
Recovery conducted unlawfully compounds the lender's loss with liability of their own.
3.5.3Critical
Account for recovered funds promptly and in full.
Recovered money sitting undistributed is the point at which a recovery problem becomes a misappropriation problem.
How the standards are applied
Through verification. The verification methodology sets out what is checked against these standards, what evidence is required, what each status means and how records are reviewed or withdrawn. The checks have been carried out on one organisation: the Founding Gold Partner’s record publishes the assessment scope, the evidence reviewed, the connection between that organisation and the Association’s founding members, the checks that do not apply to its role, and the items still open. Every record is written to be weighed rather than taken on trust.
Partnership tier
Describes a commercial or strategic relationship with the Association — who supports the work, and how. It is disclosed so a reader can weigh it.
It is not an assessment of anything, and it cannot be used to obtain a verification.
Verification status
Describes whether the Association’s published checks have been completed on a named organisation or person, what was checked, and when.
It is not regulatory approval, and it is not a guarantee about any arrangement.
Conduct expectations that apply continuously, rather than at the point of a check, are in the code of conduct. What happens when a standard is breached is in complaints and review.
How these will change
Standards written by one organisation for a market it participates in are worth less than standards developed with the market and reviewed by people who do not depend on it. The governance page sets out what has to exist before that can be claimed, and what the Association is not claiming in the meantime. Comments on any standard on this page are welcome at info@privatelendingassociation.co.za and are read.
Common questions
- Are these standards legally binding?
- No. The Association is not a regulator and has no statutory powers. These standards are published expectations: an organisation or practitioner that wants to be listed agrees to them, and a listing can be withdrawn where they are not met. Legal obligations come from the National Credit Act, FAIS, FICA and the other law referenced throughout this site, and they apply whether or not anyone is listed here.
- Why is every standard numbered, and what do the markings mean?
- So that a standard can be cited precisely in a verification record, a complaint or an assessment question, and mean the same thing in each. Each rule is marked Critical, Major or Standard: 21 of the 36 are Critical, and a single established breach of one of those is grounds to suspend or withdraw a listing. Numbers are permanent — a withdrawn rule is marked withdrawn rather than deleted, and its number is never reissued.
- What happens if a listed organisation breaches a standard?
- It is dealt with under the complaints and review process: the Association can record the matter, ask for an explanation, correct what it publishes, and change or withdraw a listing. It cannot fine anyone, order redress or compel anything. Where a matter is a regulatory one, the complaints page names the body that can act.
This page explains how something works. It is not financial, legal or tax advice, it takes no account of your circumstances, and nothing here is a recommendation to lend. Private lending places capital at risk.