National Consumer Credit Protection Act 2009 (Cth)
To ensure that we meet our “responsible lending” obligations under the National Consumer Credit Protection Act 2009 (Cth) (NCCP), which took effect on 1 January 2011, Capital Finance Australia Limited has made a number of changes to our business, processes and documentation.
Background on NCCP
The NCCP is a significant reform of the national credi t industry which establishes a national credit regime that aims to give consumers greater protection from unscrupulous lenders, poor lending practices and excessive levels of debt by imposing tighter regulations on the processing and approval of credit applications by financial service providers.
Key components of the new national credit regime include:
The “responsible lending” obligations of the NCCP commenced on 1 January 2011.
The purpose of these obligations is to ensure that “credit providers” (e.g. banks, credit unions and finance companies) and “credit assistance providers” (e.g. brokers) do not:
If the credit contract is “unsuitable” for the consumer.
A credit contract is considered “unsuitable” if it is likely that:
The consumer will be unable to comply with his or her financial obligations under the proposed credit contract or could only comply with “substantial hardship”; or
The changes that Capital Finance Australia Limited has implemented were effective as of 1 January 2011 and further enhance our existing policies on “Responsible Lending” and “Treating Customers Fairly”.