Document background
The Line of Credit Agreement and Note is a fundamental financial instrument in South African banking and lending practices. It is used when a lender agrees to provide a borrower with access to a revolving credit facility up to a specified limit, allowing for multiple drawdowns and repayments over time. The document must comply with the South African National Credit Act, the Banks Act, and other relevant financial services legislation. It includes comprehensive terms covering facility limits, interest calculations, repayment obligations, security arrangements, and default provisions. This type of agreement is particularly useful for businesses requiring flexible working capital financing or individuals needing access to recurring credit. The agreement incorporates both the credit facility terms and a promissory note component, providing security for the lender while ensuring transparency and fairness for the borrower under South African law.
