According to the most recent numbers available, approximately 2.4 million foreign-born individuals live in South Africa, contributing to the South African economy through work and entrepreneurship.
However, many face financial challenges, especially when trying to secure loans for business, vehicle or property purchases, living expenses, or investments. These financial barriers limit their full economic participation.
JustMoney.co.za, a platform that helps people make good money choices. explores the various loan requirements and application processes for foreign nationals in South Africa.
“Most lenders require proof of a valid residency visa and/or work permit, stable income, local bank account, and local credit history,” says Sarah Nicholson, JustMoney operations manager.
“Some providers have stricter lending criteria than others, and approval of all types of loan applications is not guaranteed, even with the appropriate documents. Affordability is a key factor.”
If you’re a non-South African resident applying for a loan, Standard Bank, for example, requires you to be 18-64 years old, have a valid passport, proof of South African residency, a valid work or residency permit, and a stable income (with three months’ payslips). Ideally, you should be employed for at least six months with your salary paid directly into your bank account.
Lenders prefer applicants with a financial track record in South Africa.
Loan terms may also be affected by your credit history and the validity and expiry date of your visa. They may be shorter, and some providers may charge higher rates or require larger deposits to reduce their lending risk.
Key regulatory frameworks also come into play, says Nicholson.
- The Financial Intelligence Centre Act (FICA) will require the bank to verify your identity and report any suspicious transactions.
- The Currency and Exchanges Act controls the movement of money in and out of the country.
- The Protection of Personal Information Act (POPIA) protects private information and sets rules for how banks handle your data.
- The National Credit Act (NCA) regulates lending in South Africa.
Applying for home loans
Foreign nationals may apply for a home loan, but there are key factors to consider, as Absa’s home loans department highlights.
- You must provide proof of income (an employment contract or salary slip), to show you can afford to repay the loan.
- Lenders assess your residence status, which may lead to a shorter loan term, higher repayments, and/or a larger initial deposit.
- Since the renewal of your residency permit isn’t guaranteed, your future job security, and your ability to repay your loan, may be in question.
- Regulatory checks, including South African Reserve Bank approval, FICA verification, exchange control regulations, anti-money-laundering legislation and proof of funding sources, affect your loan eligibility.
As with other loan applications, you’ll have to submit a signed offer to purchase, proof of income, and marriage or divorce certificates verified by an attorney (if applicable). This is in addition to a valid passport, employment contract, and work permit for non-South Africans living in the country on a visa.
Applying for vehicle financing
Foreign nationals can apply for vehicle financing if they have permanent employment.
Loan terms will depend on the duration of the work permit – for example, a five-year work permit may mean a maximum five-year repayment period.
Lenders also consider the expiry dates of passports, visas, and employment contracts.
Required documents include a passport, verified and valid work permit/residency visa, signed employment contract, proof of address, offer to purchase, proof of income, and valid driver’s licence.
Lebogang Gaoaketse, WesBank’s head of marketing and communication, says applicants must meet affordability criteria and have a good credit record. WesBank does not permit balloon payments, which involve paying a large sum at the end of the loan period, for foreign nationals.
Applying for credit cards
Foreign nationals living and working in South Africa may apply for credit cards from the major South African banks. You’ll need a good credit history, while income requirements vary. Nedbank’s minimum income requirement, for example, is R5,500 a month.
According to Absa’s credit card division, the following supporting documents are required when applying for a credit card: valid passport, work permit/visa valid for a minimum of two years from the date of application, proof of address not older than three months, and proof of income (bank statements or payslips not older than three months).
The bank will assess your income, expenses, and existing credit to ensure your financial stability.
“If you lack a local credit history, consider opening a current account, as this helps build credit automatically and the credit bureaus reflect this information,” advises Nicholson.
“You can also apply for a retail store account. It may be easier to qualify for an entry-level store card, or opt for a lower credit limit.”
Added challenges for foreigners
Non-South African citizens may encounter additional challenges when applying for loans, warns Nicholson.
Banks often require English translations of documents in foreign languages. It may be difficult to understand unfamiliar or complex financial or legal terms, and local banking and credit systems.
Lenders may question your financial credentials, making it harder to qualify.
To improve credibility, obtain a reference letter from your South African employer or your bank in your home country, advises Nicholson.
It’s also helpful to provide documents like tax returns, proof of assets and rental agreements, and ensure all FICA documentation (passport, work permit/visa) is valid.
“Keep in mind that banks are required to treat you like any other customer and follow set regulatory processes, which are in your favour if you meet the criteria.
“Research the requirements of various banks, provide consistent information, keep copies of documents you submit, and inform your financial institution if your contact details change,” adds Nicholson.
“By doing your homework – exploring the correct financial options for your needs, understanding lenders’ requirements, and building a strong credit profile – you will improve your chances of securing a loan and unlocking opportunities in South Africa.”
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