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During the hiring process, it is common for potential employers and recruitment agencies to run background checks on their candidates. Credit checks are one of the checks that companies choose to conduct to get an indication of the applicant’s way of spending or to check if there are any judgements or defaults against their names. Although this is important for employers to know, not all candidates qualify for a credit check, this means companies are not allowed to run credit checks on everyone.

According to the National Credit Act (NCA), potential employers cannot run a credit check without receiving permission from the candidate. Additionally, credit checks can only be requested when candidates apply for positions requiring honesty in dealing with cash or finances, this makes it applicable to job applicants interested in the Financial Sector, Senior positions and/or in positions of trust.  This information is important for Human Resource staff and Recruitment agencies to take note of as failure to comply with the above is a contravention of the National Credit Act.

Although the outcome of the candidate’s credit check report has little to do with their skills and capabilities in the workplace, it is still vital for recruiters to be knowledgeable of the information listed on the credit report so candidates cannot be refused information based on a minor negative listing on their report.

Candidates on the other hand, should run their own credit checks so they are aware of what the potential employer will see, this will also help query any unfair or incorrect listing with the credit bureau or companies that conduct these checks.