The affordability assessment is the most consequential step in a BNPL transaction — and the least understood. Most consumers experience it as an almost invisible few seconds between selecting split payment and seeing an approval confirmation. In reality, it involves a calibrated evaluation of whether a specific consumer, at a specific moment, has the genuine financial capacity to repay a specific plan. This article explains what the NCA requires, what FloatPay actually does, and why the assessment is a consumer protection feature rather than an obstacle.
The Statutory Requirement: Section 81 of the NCA
Section 81 of the National Credit Act 34 of 2005 states that a registered credit provider must not enter into a credit agreement without taking reasonable steps to assess the consumer's general understanding and appreciation of the risks and costs of the proposed credit, the consumer's debt repayment history under credit agreements with any credit provider, and the consumer's existing financial means, prospects, and obligations.
The key phrase is "reasonable steps." The NCA explicitly permits a proportionate approach — the depth of assessment should correspond to the nature and size of the credit agreement. A lender assessing a R2.5 million mortgage must conduct a full income verification and a comprehensive credit bureau enquiry. A BNPL provider assessing a R1,200 purchase may conduct a lighter assessment, provided it remains substantive rather than purely cosmetic.
What the NCA does not permit is an assessment that exists only on paper. A credit provider who processes an affordability check that has no meaningful relationship to the consumer's actual financial situation — who approves any applicant regardless of what the assessment reveals — is not complying with Section 81, regardless of whether they have called the process an "affordability assessment."
Why FloatPay Does Not Do a Hard Credit Bureau Pull
For purchases under approximately R5,000, FloatPay conducts its affordability assessment without a hard enquiry to the major credit bureaus (TransUnion, Experian, or XDS). A hard pull — a formal credit enquiry that leaves a record on the consumer's credit profile — is the standard tool for large credit assessments. But for short-term BNPL, it creates two problems.
First, a hard pull creates a visible enquiry footprint on the consumer's credit profile. Multiple hard enquiries in a short period can slightly reduce a consumer's credit score, because they signal to future lenders that the consumer has been seeking credit from multiple sources. For a consumer using BNPL regularly for everyday purchases, accumulating hard pull footprints would be disproportionately harmful relative to the small credit amounts involved.
Second, a hard pull introduces meaningful latency into the checkout flow. Retrieving a full credit bureau report, processing it, and returning an approval decision can take several seconds — long enough to create friction that affects checkout conversion. For a BNPL product competing with the speed of a debit card tap, that latency matters.
The NCA framework accommodates this. For small short-term credit, the proportionality principle allows a softer assessment approach, provided the assessment is genuine. FloatPay's approach uses a combination of declared income information, internal transaction history for returning customers, and real-time risk signals that do not require a hard bureau pull — while still providing a substantive assessment of repayment capacity.
What FloatPay's Assessment Actually Evaluates
At the point of checkout, a new FloatPay applicant provides basic identifying information — South African ID number and contact details — and a declared income figure. FloatPay evaluates several factors in real time:
Repayment capacity relative to the proposed instalment schedule: Does the declared income support the proposed monthly instalment amount comfortably? For a R1,600 purchase split into four payments of R400, the income threshold required is substantially lower than for a R4,800 purchase split into four payments of R1,200. The assessment is calibrated to the specific plan, not to a generic income band.
Internal repayment history: For consumers who have used FloatPay before, the platform has direct evidence of their repayment behaviour. A consumer who has successfully completed multiple plans without late payments represents lower risk than a first-time applicant with identical declared income. This prior-history signal is used in the assessment in a way that is directly relevant and grounded in real data.
Application-level risk signals: Device and behavioural signals from the checkout session inform the risk assessment without requiring sensitive personal data beyond what is strictly necessary for the credit decision. FloatPay processes this information in compliance with POPIA (Protection of Personal Information Act 4 of 2013), which governs how personal information is collected, used, and stored.
Concurrent active plans: FloatPay checks within its own system for active plans the applicant already holds. If a consumer already has plans with a combined outstanding balance that reduces their available repayment capacity below the threshold for the new plan, the assessment may decline or offer a lower credit amount.
What Happens When the Assessment Returns a Decline
Not every BNPL application is approved, and this is by design. An affordability assessment that approved every applicant would not be a genuine assessment — it would be a process that satisfies the letter of Section 81 while defeating its purpose.
When FloatPay's assessment returns a decline, the consumer is informed clearly and without jargon. The decline message does not reveal the specific decision factors (for privacy and to prevent gaming of the assessment), but it provides a general indication of the basis — for example, that the declared income does not support the instalment amount at the requested purchase value, or that existing active plans limit capacity for additional credit at this time.
A decline from FloatPay is not a credit bureau event. Because FloatPay does not conduct a hard pull, the decline does not appear as a rejected credit application on the consumer's credit profile. The consumer is free to try again when their circumstances change — when existing plans are paid off, when their income increases, or when the purchase is for a smaller amount.
We are not saying a decline is a positive experience. It is not. But it is meaningfully better than being approved for credit that creates financial stress, and better than a hard-pull decline that leaves a mark on the consumer's credit profile. A proportionate, genuine assessment that occasionally declines applications is the hallmark of responsible lending.
The Cross-Provider Limitation and What It Means
FloatPay's affordability assessment can see the consumer's plans within the FloatPay system. It does not have real-time visibility of BNPL plans the consumer holds with other providers — because there is currently no SA-wide bureau that aggregates short-term BNPL obligations in real time. This is a known limitation of the current market infrastructure, not a FloatPay-specific gap.
The NCR has been consulting on enhanced bureau reporting requirements for BNPL that would improve cross-provider visibility. If these changes are implemented, every registered BNPL provider's assessments will improve — because the underlying data will be more complete. FloatPay supports this direction, even though it will add compliance overhead, because more accurate affordability assessments protect consumers from the stacking problem that creates financial difficulty.
Until that infrastructure is in place, the responsibility for managing cross-provider BNPL exposure sits partly with consumers themselves. Our responsible lending page includes guidance on how to track and manage your total BNPL obligations across providers — because transparency about the limitations of the current system is part of responsible practice.
POPIA and Data Handling
Every piece of personal information collected in the FloatPay affordability assessment is processed under POPIA. This means the information is used only for the purpose for which it was collected (the credit assessment and the management of the resulting credit agreement), stored securely, not sold to third parties, and accessible to the consumer on request under their POPIA access rights.
Consumers who want to understand what information FloatPay holds about them can submit a POPIA access request through our privacy policy contact process. This is a legal right under the Protection of Personal Information Act 4 of 2013, and FloatPay's obligation to respond to such requests is enforceable by the Information Regulator of South Africa.
Questions about how FloatPay assesses affordability or handles your data? Read our full responsible lending commitment or contact us directly.