Banking Law & Finance Lawyers | south africa

A loan agreement should specify the amount of the loan, the applicable interest rate and the repayment terms. Any security for the loan should also be specified, and additional warranties and undertakings should be included and tailored according to the context.

Not necessarily, interest-free loans can be concluded, but tax advice should be sought beforehand.

The National Credit Act (“NCA”) may apply if the loan is made to an individual or SME. In the case of cross-border loans, the regulations under the Currency and Exchanges Act, 1933 may be applicable. 

The law as it applies to financial transactions aims to promote a fair, stable and accessible market to facilitate economic prosperity.

We provide opinions on aspects of finance law, advise on the structuring and documentation of financial transactions and compliance with applicable legislation, and assist clients in negotiating financing terms.

Banking and finance law governs how businesses borrow and lend money – covering loan and facility agreements, security structures, regulatory requirements on lenders, and the legal mechanics of getting a facility from signature to drawdown. It sits alongside corporate and tax law on most significant transactions, since how a deal is financed shapes how it’s structured.

South African law offers a range of security instruments depending on the asset – notarial bonds over movable property, mortgage bonds over immovable property, cessions of book debts, rights, or bank accounts, and pledges of shares or other assets. The right combination depends on what the borrower actually has available to secure, and how the lender wants to rank against other creditors if things go wrong.

Corporate finance looks to the overall creditworthiness and balance sheet of the borrowing company as security for a loan. Project finance is structured around a specific project’s future cash flows – the lender’s recourse is largely limited to the project itself, its assets, and its contracts (like a power purchase agreement), rather than the broader balance sheet of the sponsors. Project finance is common in energy and infrastructure precisely because it lets sponsors raise significant capital without over-leveraging their core business.

Conditions precedent are the requirements that must be satisfied before a lender will release funds – commonly including finalised security documentation, corporate approvals and resolutions, confirmation of other project agreements (like a PPA or EPC contract) being in place, insurance, and legal opinions. Delays most often arise where underlying commercial agreements aren’t yet finalised, or where corporate housekeeping (resolutions, registrations, consents) hasn’t kept pace with the deal timeline – which is why addressing these fundamentals early is one of the most effective ways to protect a closing date.

Companies should contact a Banking and Finance lawyer whenever they raise debt funding, whether in the context of a larger transaction or on a stand-alone basis. Counsel can help negotiate a fair deal for the borrower and ensure that the financing terms are legal and on-market. Advice should also be sought when a company lends funds, to ensure that regulatory requirements are met, the lender’s rights are protected, and any security rights are valid.

A banking & finance lawyer’s fees will depend on his / her level of experience. A junior corporate lawyer will therefore be cheaper than a senior corporate lawyer. However, a senior lawyer will usually take less time than a junior lawyer to complete the same work, and his / her years of experience will likely add more value to the client overall. In addition, lawyers fees are impacted by the type of organisation they work for. Lawyers working at traditional law firms with large buildings and teams of support staff usually need to add these overheads to their fees, making them significantly more expensive than equally qualified lawyers working through a virtual platform like Caveat.

Caveat is a virtual organisation with lawyers qualified in many jurisdictions and based in locations across the world.

Whether a lender needs to register as a credit provider under the National Credit Act depends on factors including the type of borrower, the size of the credit agreement, and whether certain exemptions apply. Commercial lending to larger corporate borrowers is often structured to fall outside the Act’s scope.

Caveat Legal’s banking and finance lawyers include practitioners with direct experience advising banks, development finance institutions, corporates and borrowers on lending, project finance, structured finance and financial regulation. Caveat gives clients direct access to experienced lawyers without the overhead of a traditional firm.