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TOPIC: Legal amount of interest charged

Legal amount of interest charged 9 years 2 months ago #3078

  • Melanie McLaren
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My husband and I run a small handyman service and we have a client that we are taking to Small Claims Court for non-payment of the final invoice. Our contract T&C clearly state that interest of 10% per month will be charged on overdue money. We do not provide credit, there is a deposit to be paid with order, an part payment on delivery and balance upon completion. We heard that we cannot charge more than 30% per annum, is this correct?
The amount outstanding is R5700 and has been since April 2012 while awaiting the court date. We are going to court again on the 11th of this month(case was postponed last month due to not enough judges being available to hear all the cases)
Is there a Small Business Act apart from the NCR?
Would appreciate any advice
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Legal amount of interest charged 8 years 9 months ago #3414

  • Rudi
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As matter of interest, how did this turn out?
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Legal amount of interest charged 8 years 7 months ago #3588

  • Lee Venkatsamy
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Charging interest can be very dangerous, especially if you're NOT a credit provider. This will leave you in a more vulnerable position, if you did not charge the correct interest rates,as well as the terms.
I believe different industries have different interest rates, eg. micro lenders can charge up to 60% per annum. You're not a micro lender, yet you charge 120% per annum, this will unfortunately count against you.

The legalities are high in your case, and my advice is that you get in contact with a debt collector, as they will advise best, and they're way cheaper than just jumping to a lawyer. Most debt collector have a legal department within their company.
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