Credit

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ASIC has published a summary document from a 30 November 2023 virtual workshop which focussed on building an understanding of identification verification challenges faced by First Nations consumers, and how industry can apply flexible approaches while meeting legislative requirements.

Read More ASIC Releases Summary for Indigenous Financial Services Framework Workshop

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“The volume of complaints escalated to AFCA has been increasing at an unsustainable rate,” David Locke, the Chief Ombudsman and Chief Executive Officer of the Australian Financial Complaints Authority (AFCA), said.  

“Scam-related complaints to AFCA have nearly doubled between 2022 and 2023. They continue to be of great concern to us. We are also seeing the impact of increased interest rates and cost of living pressures, with complaints involving financial hardship also significantly higher,” Mr Locke said.

Read More Ombudsman Warns of “Unsustainable” Increase as AFCA sees a Record 100,000 Complaints

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ASIC has extended its product intervention orders made in relation to short term credit and continuing credit contracts so that the orders remain in force until they are revoked or they sunset on 1 October 2032.
Since the orders came into effect on 15 July 2022, they have reinforced consumer protections by preventing the provision of short term credit and continuing credit contracts that involve unreasonably high fees. These fees exceeded the cost caps imposed by the National Credit Code.

Read More ASIC Extends 2022 Product Intervention Orders on Credit

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Consumer Action Law Centre (Consumer Action) has filed a class action in the Federal Court of Australia against Taylors Business Pty Ltd. The lead plaintiff, a Victorian woman, represents herself and a group of Taylors Business customers who pawned goods of value to them, but can no longer access their goods because the business has been shut down. Consumer Action became involved when we had a spike of enquiries to our frontlines from affected customers, many distraught at the prospect of losing their items.

Read More Class Action Launched in Federal Court Against Pawnbroker ‘Taylors Business’

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The current product intervention orders came into effect on Friday 15 July 2022. They reinforce consumer protections by prohibiting the provision of short term credit and continuing credit contracts, which involve unreasonably high fees charged to retail clients. These fees exceed the cost caps imposed by the National Credit Code.

If not extended, the short term credit and continuing credit contracts product intervention orders will expire on 15 January 2024.

Read More ASIC Consultation on Extending Product Intervention Orders on Short Term Credit Facilities and Continuing Credit Contracts

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ASIC has been successful in its action against Cigno Pty Ltd (Cigno) and BHF Solutions Pty Ltd (BHF Solutions), with the Federal Court finding that both companies engaged in credit activities without holding an Australian credit licence. ASIC also obtained permanent injunctions against Cigno and BHF Solutions to protect consumers.

The decision follows a series of appeals during the litigation, including an unsuccessful bid by Cigno and BHF Solutions to seek special leave in the High Court in December 2022 (22-360MR).

Read More Cigno, BHF Solutions Found to Have Engaged in Unlicensed Conduct

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Key stakeholders call for buy now, pay later should be regulated as meantime credit In submissions released publicly by the Treasury today, major banks, industry associations, regulators and consumer advocates are unified in calling for an end to lending loopholes allowing buy now, pay later providers to avoid safe lending laws.  Groups who made submissions…

Read More Advocates and industry agree: Time to close lending loopholes on buy now, pay later

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After a late-night Senate sitting, Consumer Advocacy groups across Australia are celebrating the passing through the Federal Parliament of long overdue reforms that will protect consumers from falling into payday loans and consumer lease debt traps. The Financial Sector Reform Bill 2022 has finally passed after 6 years of advocacy by the Stop the Debt…

Read More Consumer protections for high-cost and harmful payday loans and consumer leases finally pass Parliament

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Buy now pay later (BNPL) products must be fully regulated as credit to protect consumers and put all credit providers on a level playing field, a coalition of consumer groups has said. The group, including CHOICE, financial counselling associations and consumer legal centres, has made the call as Treasury releases a consultation paper setting out…

Read More Buy now pay later changes must go all the way, consumer groups say

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CHOICE has joined consumer groups from 9 countries, including Consumers’ Federation of Australia (CFA), calling for urgent action on buy now, pay later (BNPL) credit providers as new data shows many Australians are struggling with this form of debt.  This is a media release from CHOICE. It was originally published on 17th March, 2022.  The global statement…

Read More Global alliance calls for regulation of harmful buy now, pay later industry