--- title: "Meerkat vs Debt Consolidation Loans: What’s the Better..." description: Explore the differences between Meerkat's debt review services and debt consolidation loans in South Africa. Understand which option offers better leg... image: https://www.meerkat.co.za/hubfs/Debt%20Solutions.jpg --- × ![blog image](https://www.meerkat.co.za/hs-fs/hubfs/Debt%20Solutions.jpg?width=640&height=360&name=Debt%20Solutions.jpg) Meerkat vs Debt Consolidation Loans [Debt Solutions](https://www.meerkat.co.za/blog/tag/debt-solutions) # Meerkat vs Debt Consolidation Loans: What’s the Better Option for You? [Meerkat](https://www.meerkat.co.za/blog/author/meerkat) | 17 September 2025 When you’re feeling overwhelmed by debt, it’s natural to look for solutions that will give you breathing room and a clear path forward. In South Africa, two of the most common options are **Debt Review** (also known as Debt Counselling) and **Debt Consolidation Loans**. While they both aim to simplify your financial life, they work very differently and come with their own advantages and risks. Let’s unpack the differences, so you can make the best decision for your situation. ## **What is Debt Review?** **Debt Review is a legal process regulated by the National Credit Regulator (NCR).** Meerkat is an NCR-registered debt counsellor and service provider. Here’s how it works: - A debt counsellor assesses your income, expenses, and debts. - They negotiate with your creditors to **reduce interest rates** and/or **extend repayment terms**. - All your debt repayments are combined into **one affordable monthly payment** via a Payment Distribution Agency (PDA). - Once you’ve repaid your debts under the plan, you’re issued a **clearance certificate**, confirming that you’re debt-free. Debt Review is designed for people who are **over-indebted** and need both affordability and legal protection from creditors. 👉 Learn more: [What is Debt Review?](https://www.meerkat.co.za/blog/what-is-debt-review-south-africa) ## **What is a Debt Consolidation Loan?** A **debt consolidation loan** is when you borrow one new loan, usually from a bank or lender and use it to pay off several smaller debts, such as credit cards or store accounts. Instead of juggling multiple repayments, you’re left with one loan to repay. The idea is to simplify things and potentially lower your monthly repayment if you can secure a better interest rate or stretch the repayment term. But it’s important to remember: - You still owe the **full principal plus interest** of the new loan. - If the loan comes with high interest or a very long term, you may end up paying **more over time**.  ## **Key Differences Between Debt Review and Consolidation Loans** | **Feature** | **Debt Review (via Meerkat)** | **Debt Consolidation Loan** | | --- | --- | --- | | **Legal protection** | Once your plan is made a court order, creditors can’t take legal action or repossess assets while you’re in good standing. | No special protection beyond what any loan offers. Miss payments, and you risk default or legal action. | | **Impact on assets** | Protected from repossession if you comply with the plan. | If the loan is secured, your assets could be at risk. | | **Interest rates & fees** | Counsellors negotiate lower interest rates and affordable terms. | Rates depend on your credit score; they may include new fees and higher lifetime costs. | | **Qualification** | Designed for people who are already over-indebted. | You must meet lender criteria and have a good credit score and affordability. | | **Monthly payments** | Reduced and tailored to your affordability. | It could be reduced, but often by stretching the term, which increases long-term costs. | | **Credit record impact** | Being under debt review shows on your credit profile until you complete the process. | A new loan creates a credit enquiry; repayments can improve your record over time if you pay on time. | | **Long-term cost** | Often saves money by reducing interest and avoiding arrears. | It could cost more if the new interest rate is high or the loan term is long. | - **Choose Debt Review if:** - You’re already **over-indebted** (more than half your income going to debts, missed payments, creditor pressure). - You want **legal protection** and a structured, regulated process. - You need a payment that’s matched to what you can realistically afford. - **Choose a Debt Consolidation Loan if:** - Your debts are **manageable**, and you still have a **good credit record**. - You qualify for a **lower interest rate** than your current debts. - You’re disciplined and won’t fall back into using other credit facilities after consolidation. ### **Possible Downsides to Consider** **Debt Review downsides:** - Your credit record reflects you’re under review until completion. - It can take several years, depending on the size of your debt. - There are regulated fees. **Debt Consolidation downsides:** - Longer terms may mean **much higher total interest**. - If you don’t close old credit accounts, you may end up with **more debt**. - Not everyone qualifies; interest may be high if your risk is high. [📂Find out More](https://www.meerkat.co.za/blog/why-you-shouldnt-take-out-a-debt-consolidation-loan)   ### **So, What’s “Better”?** There’s no single “best” option; it depends on your situation. Ask yourself: 1. How much debt do I have, and how many accounts? 2. What interest rates am I currently paying? 3. Is more than half of my income already going to debts? 4. Do I qualify for a loan at a **favourable rate**? 5. Do I need immediate **legal protection from creditors**? 6. Can I commit to avoiding new debt? ## **In Summary** - If you’re **over-indebted**, struggling to cope, and worried about creditor pressure, then **Debt Review through Meerkat** is usually the safer, more sustainable route. - If your debts are **manageable**, you have **good credit**, and you can secure a consolidation loan at a favourable rate, then consolidation could simplify your life and even help you pay off faster. At Meerkat, we’re here to help South Africans do **more with their money**, not just get out of debt, but build lasting financial wellness. [![Meerkat Logo-3](https://no-cache.hubspot.com/cta/default/6684549/interactive-173846252701.png) ](https://www.meerkat.co.za/hs/cta/wi/redirect?encryptedPayload=AVxigLKNJjV%2BvWRC7UMLjDKYTQMWRjRprcAR5SiYLnPgG79mkfQ4qK6rySDnh%2BYYkeXO8jkLZUACYy2MYzTNRE1yVg%2FhKGcjrZqmmrHzkkqHPBbbI%2FTRus1BxBO6eSRYMJ2SPFrpSJUhQAdyxENkE3twVY2OYDlUHdD7TiZqRfJJlqIOvTCQogdOCw%3D%3D&webInteractiveContentId=173846252701&portalId=6684549) ## Recent posts like this: ### [What to do if Debt Collectors are harassing you](https://www.meerkat.co.za/blog/what-happens-if-you-dont-pay-your-debt-in-south-africa) 3 min read If you don't pay your debt, usually, after issuing you with a letter of demand (Section 129 Notice) a creditor may hand over your debt to a debt collector who will then be tasked with getting that mon... [What to do if Debt Collectors are harassing you Read more ](https://www.meerkat.co.za/blog/what-happens-if-you-dont-pay-your-debt-in-south-africa) ### [How to Cancel Debt Review in South Africa (Step-by-Step Guide)](https://www.meerkat.co.za/blog/how-can-i-cancel-debt-review) 3 min read Many South Africans want to know whether they can cancel debt review and if so, how. The short answer is: You can only cancel debt review once your debt has been fully settled, and your debt counsello... [How to Cancel Debt Review in South Africa (Step-by-Step Guide) Read more ](https://www.meerkat.co.za/blog/how-can-i-cancel-debt-review) ### [How to Get ITC Clearance in South Africa (Step-by-Step)](https://www.meerkat.co.za/blog/how-you-can-get-itc-clearance-in-south-africa) 3 min read Quick answer ITC clearance means having your debt review flag removed from your credit record after you've paid off your debts. The only person who can legally issue a clearance certificate (Form 19) ... [How to Get ITC Clearance in South Africa (Step-by-Step) Read more ](https://www.meerkat.co.za/blog/how-you-can-get-itc-clearance-in-south-africa) #### Let us contact you Enter your details below and we will contact you shortly [×](https://www.meerkat.co.za/blog/meerkat-vs-debt-consolidation-loans-whats-the-better-option-for-you#0) #### Let's get to know you better Quick Quote Funeral Cover [×](https://www.meerkat.co.za/blog/meerkat-vs-debt-consolidation-loans-whats-the-better-option-for-you#0) ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Meerkat", "url" : "https://www.meerkat.co.za/blog/author/meerkat" }, "dateModified" : "2025-09-17T10:35:16.201Z", "datePublished" : "2025-09-17T10:03:12.000Z", "headline" : "Meerkat vs Debt Consolidation Loans: What’s the Better Option for You?", "image" : [ "https://www.meerkat.co.za/hubfs/Debt%20Solutions.jpg" ], "mainEntityOfPage" : { "@id" : "https://www.meerkat.co.za/blog/meerkat-vs-debt-consolidation-loans-whats-the-better-option-for-you", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://www.meerkat.co.za/hubfs/MOKU%20FULL%20POSE%201%20(2).png" }, "name" : "MyMeerkat FSP (Pty) Ltd" } } ``` ```json { "@context" : "https://schema.org", "@id" : "https://www.meerkat.co.za/#organization", "@type" : "Organization", "address" : { "@type" : "PostalAddress", "addressCountry" : "ZA", "addressLocality" : "Pinelands", "addressRegion" : "Western Cape", "postalCode" : "7405", "streetAddress" : "203 Pine Park" }, "contactPoint" : { "@type" : "ContactPoint", "areaServed" : "ZA", "availableLanguage" : "English", "contactType" : "customer service", "email" : "info@meerkat.co.za" }, "description" : "Meerkat is a South African financial wellness company offering funeral cover, debt review, credit life insurance, savings, and group funeral plans. 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