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The federal government’s decision to bring forward the new responsible lending requirements for brokers and lenders has been met with mixed reviews.
On 14 August 2009, the government released the National Consumer Credit Protection (NCCP) Regulations and announced changes to the timetable for implementation.
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The responsible lending provision requirements will now come into effect on 1 January 2010 for all lenders and brokers who are not authorised deposit-taking institutions (ADIs) or registered finance companies (RFCs).
Assistant Treasurer Nick Sherry supported the government’s move and said it would better protect consumers.
“Under the new timetable for reform, there will be no gap in consumer protection between ‘turning off’ the existing state and territory credit regimes and ‘turning on’ the new commonwealth regime,” Mr Sherry told the Financial Services Institute of Australasia (Finsia) conference yesterday.
Former director of Consumer Affairs Victoria and former commissioner of the Australian Competition and Consumer Commission, David Cousins, was less than impressed with the government’s decision to bring forward the legislation and said he had concerns about the details of the new national framework.
“If effective, the licensing and responsible lending provisions will raise industry standards but at a cost which will be passed onto borrowers,” Mr Cousins told The Australian Financial Review.
According to the Daily, Mr Cousins is also disgruntled with the short consultation time and said that it only allowed those in the ‘credit club’ to consider the reforms.
