What Credit Managers, CFOs and SME Owners Need To Know

If you are a credit manager, CFO, financial manager, or SME owner, here is something you need to know right now:

The In Duplum Rule is one of the most misunderstood pieces of South African law — and if you do not understand exactly how it works, it could quietly be eating away at the interest you are legally entitled to recover.

The short answer?

The In Duplum Rule caps the amount of arrear interest that can accrue on an unpaid debt.

Once that interest equals the outstanding capital, it stops running.

Payments restart it. Judgment resets the clock. And the National Credit Act (NCA) makes the rule even broader by including fees and charges in the cap.

Getting this wrong costs businesses real money every single day.

Read on. We are going to break this down in plain language, show you exactly how it affects your collections strategy, and give you practical, actionable tools to work smarter — not harder.

Table of Contents

1. What is the In Duplum Rule?
2. The Common Law vs the Statutory (NCA) In Duplum Rule
3. How the In Duplum Rule Affects Your Collections in Practice
4. The In Duplum Rule and Judgment Debt
5. What Counts Towards the Cap? The NCA Breakdown
6. The In Duplum Rule in B2B vs Consumer Collections
7. How Payments Affect the In Duplum Cap
8. The Role of Litigation and Pending Legal Proceedings
9. Common Mistakes Businesses Make
10. Five Troubleshooting Tips for Credit Managers and CFOs
11. The Kredcor Approach

1. What Is the In Duplum Rule?

“In duplum” is a Latin phrase that literally means “double the amount.”

The In Duplum Rule is a long-standing principle of South African law that limits the amount of arrear interest a creditor can recover from a debtor who is in default.

In simple terms:

Once the arrear interest on a debt equals the outstanding capital amount, interest stops running.

It does not disappear. It does not reset to zero.

It simply pauses.

The moment the debtor makes a payment, interest begins running again — up to the cap again if the debtor defaults again.

The rule developed from public policy considerations. Courts recognised that allowing interest to accumulate indefinitely against a defaulting debtor would be fundamentally unfair.

At the same time, the rule also encourages creditors to act promptly. A creditor who simply sits back and allows interest to accumulate indefinitely is not acting in good faith either.

For clients at Kredcor — whether an SME owner protecting cash flow, a credit manager managing a debtor book, or a CFO monitoring the balance sheet — understanding the In Duplum Rule is not merely legal theory.

It has a direct financial impact on:

• what you can recover
• how quickly you must act
• how your collections process should be structured