Important POPIA Points for Trading on Credit

Created by Amy Sara Price, Modified on Thu, 10 Jul at 1:41 PM by Amy Sara Price

✅ Important Points for Trading on Credit

To ensure compliance and best practice when onboarding or assessing a customer for trade credit:

1. Consent & Permissions

Explicit consent must be obtained from the data subject (e.g. company representative) before collecting or processing personal data such as ID numbers or directorship details.
Always document consent through tick boxes, signed application forms, or digital acceptance.

2. Purpose Specification

Data must be collected only for the stated and lawful purpose—e.g. credit assessment, due diligence, or legal obligations.
You may not reuse the data for unrelated activities without fresh consent.

3. Processing Limitation

Collect only the minimum data necessary to assess creditworthiness.
Avoid excessive data requests—stick to information directly relevant to the credit decision.

4. Lawful Processing of Special Personal Information

If data such as biometric info, health status (e.g. from sole proprietors), or criminal history is required for a credit decision:

There must be a legal obligation, explicit consent, or a public interest justification for collection.
Special care must be taken when dealing with children’s information (e.g. family-owned trusts or sole traders).

5. Information Quality

Keep financial, contact, and registration data accurate and up to date.
For credit reviews or term changes, periodically request updated financials or contact details.

6. Openness

Be transparent about:
- What data is collected,
- Why it’s needed,
- Who it will be shared with (e.g. credit bureaus),
- And how it will be stored.

7. Security Safeguards

Implement data encryption, access control, and secure storage (digital and physical).
For example, scanned CIPC documents and ID copies must be stored securely with access limited to credit/risk staff only.

8. Data Subject Participation

The customer (data subject) has the right to:
- Access their data,
- Request corrections,
- Withdraw consent where applicable.

? Key Considerations When Using Personal Data in Credit Applications

Area	Best Practice
ID Copies of Directors	Only collect if needed for suretyship or legal compliance, store securely.
Bank Statements	Ensure bank info is used only for risk assessment, not shared further.
Contact Info	May be used for communication or default notifications—but not for marketing without consent.
Trade References	Inform the applicant you’ll contact third parties for verification.
Credit Bureau Checks	Notify the subject and include it in the credit application terms.
Retention of Data	Only retain data for as long as needed for the credit relationship; dispose of securely afterwards.

? Practical Tips for Compliance in Credit Trading

Include a POPIA clause in your credit application form stating:
- The purpose of data collection,
- The right to access or withdraw data,
- That the company may share data with credit bureaus, legal partners, etc.
Have a privacy policy linked on your website or attached to the application pack.
Use two-factor authentication and password protection for shared customer folders or files.
Regularly train staff who access personal data on POPIA responsibilities.

? Suggested POPIA & Sole Proprietor Clauses for Credit Terms and Conditions
1. Consent to Process Personal Information
The Applicant (including in the case of a Sole Proprietor) hereby consents to the collection, use, and processing of their personal information by [Your Company Name] for the purpose of assessing this credit application, managing the training engagement, and any related business activities in accordance with the Protection of Personal Information Act No. 4 of 2013 ("POPIA").
2. Purpose Specification
All personal information provided will be used strictly for the purposes of credit vetting, account management, training delivery, legal compliance, and communication related to the services offered. This information will not be used for unrelated purposes without the Applicant’s prior consent.
3. Third-Party Sharing
The Applicant understands and agrees that [Your Company Name] may share relevant personal information with third parties such as credit bureaus, trade references, legal counsel, and training facilitators where such disclosure is necessary to fulfill contractual or legal obligations.
4. Data Security
[Your Company Name] undertakes to store and process all personal information in a secure and responsible manner, implementing reasonable technical and organisational safeguards to prevent unauthorized access, disclosure, alteration, or destruction of such data.
5. Data Subject Rights
The Applicant has the right to request access to, correction, or deletion of their personal information held by [Your Company Name]. Such requests must be submitted in writing to the appointed Information Officer at [email address].
6. Retention and Deletion
Personal information will be retained only for as long as it is necessary to fulfil the purposes stated herein or as required by law. Thereafter, such data will be securely destroyed or deleted.
7. Training Participation Data
In the case of training engagements, the Applicant consents to the collection and use of training-related data (such as attendance records, feedback, assessments, and certificates issued) for reporting, quality control, and internal evaluation purposes.
8. Sole Proprietor Declaration
Where the Applicant is a Sole Proprietor, the Applicant acknowledges that personal and business information may be intertwined and hereby consents to the processing of such data as necessary for the fulfilment of this credit agreement.