Back to EasyEquities Submit a ticket
  1. Help Centre Home
  2. Knowledge Base
  3. Platforms
  4. EasyCredit

Help Menu

Open navigation

How does pledging and on-pledging of securities work?

What is a pledge? 

A pledge is a limited real right of security in a movable asset. It is created by an agreement between the debtor who is the owner of the asset and the creditor to who the debtor owes a debt to, and the purpose of the pledge is to secure the debt owed by the debtor to the creditor.

All EasyCredit loans are secured loans. This means that when you take out a loan with us, you are required to pledge the holdings in your EasyEquities ZAR account and/or your TFSA, depending on what you select, to EasyEquities as security for your loan. 

Therefore, if you fail to make any payment required under your loan with us, for example, your monthly interest payments or the capital payment at the end of your loan term, EasyEquities can sell the holdings in your selected account/s, which you pledged to it as security for your loan, to cover these failed payments. 

What is an on-pledge? 

In order for EasyEquities to provide you with the loan, EasyEquities obtain a loan from a third party funder/s.

On-pledging is the process whereby the qualifying securities in the account/s that you selected to pledge to EasyEquities in terms of the EasyCredit loan agreement are on-pledged by EasyEquities to its third-party funder/s. In order for the on-pledge to be valid, EasyEquities must obtain your consent.

Therefore, in taking out an EasyCredit loan, you consent for EasyEquities to on-pledge the qualifying securities in your EasyEquities ZAR account and/or your TFSA, depending on what you selected, to its third-party funder/s. 

Did you find it helpful? Yes No

Send feedback
Sorry we couldn't be helpful. Help us improve this article with your feedback.

© EasyEquities. EasyEquities is a product of First World Trader (Pty) Ltd t/a EasyEquities which is an authorized Financial Services Provider (FSP number 22588). All trades on the EasyEquities platform are subject to the legal terms and conditions to which you agree to be bound. The EasyEquities platform enables users to invest in securities which includes whole shares and fractional share rights (FSRs). EasyEquities acts as an agent for the issue of whole shares, where the investor is the registered owner of those shares, entitled to dividends, participation in corporate actions and all the economic benefits and risks associated with share ownership.

In respect of FSRs, EasyEquities acts as principal to a contract for difference issued to the investor, where the investor will have a contractual claim against EasyEquities to the economic benefits and risks associated with share ownership (price movements and dividends) without having ownership rights in the underlying share. Fractional share rights (FSRs) which are issued through a contract for difference, are an over the counter derivative. Unlike whole shares, FSRs do not carry any voting rights. As the investor makes further investments in FSRs and ultimately ends up with a whole share, the contract for difference is closed out and ownership whole share is delivered to the investor.

The availability of any share on the EasyEquities platform is based on various factors but is not an indication of value and does not mean that any share is an appropriate investment for you.

The availability of any share on the browse shares page does not necessarily indicate any contractual relationship between EasyEquities and the listed company, or the payment of fees for services. Brand Logos are owned by the respective companies and not by EasyEquities. The use of a company’s brand logo does not represent an endorsement of EasyEquities by the company, nor an endorsement of the company by EasyEquities, nor does it necessarily imply any contractual relationship. Further investment disclosures are available on the EasyEquities website.

* Note exchange prices are delayed in accordance with regional exchange rules. South African prices are delayed by 15 minutes; North American prices are delayed by 15 minutes; Australian prices are delayed by 20 minutes.

EasyEquities is a subsidiary of Purple Group Limited, a company listed on the JSE Limited (PPE)