Loan Rollover

A loan rollover occurs when a short-term loan — typically a payday loan — is extended beyond its original due date, usually by paying only the interest or fees and deferring the repayment of the principal. In South Africa, rollovers on payday and short-term loans are considered a predatory practice and are restricted under the National Credit Act’s reckless lending provisions. A rollover that is structured as a new loan agreement (with new fees applied) can result in the borrower paying significantly more than the original loan amount over time. If a lender suggests rolling over your loan rather than helping you restructure the repayment, this is a warning sign.