What is the difference between debt review and blacklisted?

Debt review versus blacklisted—what’s the real difference?

They might sound similar, but the two couldn’t be more different.

Curious to know how debt review differs from blacklisting?

Let’s find out.

 

Difference between debt review and blacklisted

Debt review is a voluntary legal process under the National Credit Act that helps people who have too much debt repay what they owe by lowering monthly repayments. While being blacklisted refers to having a poor credit status resulting from bad credit payment behaviour. Like defaulting or incurring judgments. Debt review limits access to credit temporarily but helps with financial recovery. Whereas ‘blacklisting’ restricts credit access until credit behaviour improves. This may take 10 years or more in severe cases.

Think of debt review as a structured way to fix finances. Whereas blacklisting is a sign of trouble. It’s something that requires a lot of hard work to overcome.

Debt review vs blacklisted:

Aspect	Debt Review	Blacklisted
Definition	A voluntary legal process designed to reduce debt.	A status indicating serious credit issues.
Access to Credit	Temporarily limited while under debt review.	Extremely limited, if available at all, for an indefinite period.
Duration	Ends upon full debt repayment or court order removal.	Persists until negative credit report entries are cleared.
Purpose	Supports financial recovery through manageable repayments.	Reflects risk to lenders, deterring new credit approvals.
Impact on Employment or Rentals	None in most cases, as it indicates financial responsibility.	Can hinder rental agreements or credit-dependent job applications.

 

Now that we’ve covered the basics, let’s dive into the specifics of being blacklisted first. Then, we’ll go over debt review.

 

 

Blacklisted

What happens when you are blacklisted?

When someone is ‘blacklisted’ it means they have a really bad credit history and credit score. Which makes it very hard for them to get credit from banks or other lenders.

It doesn’t affect existing loans as long as these loans don’t go into default. But getting a new loan, applying to rent a home, or getting a cellphone contract can become a big challenge. 

Anything that requires a credit check is affected.

Basically, being ‘blacklisted’ means having a credit history that is so bad that no one wants to lend you money or enter into legal agreements that require payment (like rental contracts).

It’s a big deal.

Fun fact: There used to be an actual ‘blacklist’, today the term ‘blacklisted’ is still used to describe someone with credit restrictions, but it’s all based on recorded credit behavior. Not an actual list.

 

How do I know if I’m blacklisted?

To find out if you are blacklisted, check your credit score and credit report for negative listings. An extremely low score or lots of negative listings may mean that you are effectively blacklisted.

South Africans can request a free credit report from South African bureaus like TransUnion or Experian, or use apps like My Credit Check.

So, how does the debt review compare?

It’s a different ball game. And it’s a positive, unlike being blacklisted.

Let’s take a closer look.

 

Debt review

What happens when you are under debt review?

When someone applies for debt review, a debt counsellor restructures their repayment terms with creditors to make monthly repayments more affordable. While under debt review, lenders can see a ‘debt review status’ listing, which tells them not to approve new credit because the person is repaying their debt. 

After debt review, the temporary debt review listing is permanently removed.

The debt review status only restricts access to new credit while the person is under debt review.

It’s like a pause on borrowing so you can focus on repaying what you owe.

 

Am I under debt review?

To find out if you are under debt review, check your credit report for a “debt review” listing or flag. Simply request a free credit report from any of the South African credit bureaus or use apps like My Credit Check or ClearScore.

See…there’s a big difference.

 

 

It’s a misconception that debt review blacklists people.

Let’s go over a couple more misconceptions about debt review.

 

Common misconceptions about debt review

1. Misconception: Debt review equals being blacklisted

Debt review is not the same as being blacklisted. While blacklisting reflects a poor credit history, debt review is a legal process designed to manage and repay debts responsibly. Debt review does not affect someone’s credit score in the same way.

 

2. Misconception: Assets will be lost under debt review

Debt review includes legal protection that prevents asset repossession as long as repayment terms are met. Essential property remains secure throughout the process.

 

3. Misconception: Debt review is permanent

Debt review is a temporary arrangement that ends when the debts are repaid and a clearance certificate is issued. Credit access opens up after the debt review process.

 

4. Misconception: Only individuals with severe debt issues qualify

Eligibility for debt review extends beyond extreme cases. People who are struggling to manage monthly repayments or feeling overwhelmed by debt obligations may also qualify for assistance.

 

5. Misconception: Debt review damages credit scores permanently

Debt review does not permanently harm credit scores. Consistent payments under the plan can improve financial profiles, and cleared debts enable credit rebuilding over time.

Remember, the National Credit Act introduced debt review specifically to help South Africans.

Check this out.

 

How the National Credit Act protects consumers

The National Credit Act (NCA) helps create fairness in South Africa’s credit system. It protects borrowers from being treated unfairly and encourages responsible lending. For people in debt, the NCA offers protection through debt review, which prevents legal action and repossession if payments are made as agreed.

 

How debt review can prevent blacklisting

Debt review can actually help prevent the negative credit behaviour that leads to being blacklisted.

Here’s how it helps:

• Makes monthly repayments more affordable
• Protects applicants from legal action like repossession or garnishee orders
• Prevents further defaults to avoid blacklisting
• Helps rebuild finances and financial habits

 

Makes monthly repayments more affordable: Debt review restructures your debts into one affordable repayment plan, and can even reduce interest rates. Which makes it easier to keep up and repay the debt.

Protects applicants from legal action like repossession: Creditors cannot take legal steps against someone who is under debt review, as long as the person makes payments under the new affordable repayment terms.

Prevents further defaults to avoid blacklisting: By ensuring debts are repaid on time, debt review prevents defaults and judgments that could lead to being blacklisted.

Helps rebuild finances and financial habits: Debt review can help applicants become debt-free and can improve their creditworthiness in the long run.

Debt review offers an easy way to stay out of financial trouble. It can help someone avoid ruining their credit score and being ‘blacklisted’ or it can help them recover.

Either way, debt review is here to help. And it is not the same as blacklisting.

⭐ Related content:

• Being blacklisted in South Africa (what you need to know)
• How to check if you are blacklisted (+ what to look for)

 

Final thoughts

The difference between debt review and being blacklisted is more than just terminology—it’s about opportunities versus obstacles.

For those under debt review, follow the repayment plan and make the most of the financial reset it offers. For those who are blacklisted, focus on clearing your debts and rebuilding your credit score.

If you’re struggling with debt, we could help reduce how much it costs every month and free up some of your income for other critical expenses. Try our online assessment at My Debt Hero to see if you qualify.