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The Australian Securities and Investment Commission (ASIC) has released a regulatory guidance to help credit licensees comply with the impending National Consumer Credit Protection legislation.
The guidance, which can be downloaded from the ASIC website, was designed to help licensees develop arrangements and systems to meet their responsible lending obligations; as well as understand what ASIC expects when assessing whether licensees are complying with their responsible lending obligations.
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The National Consumer Credit regime and responsible lending obligations will come into play from 1 July 2010.
According to a statement released by ASIC yesterday, the key responsible lending obligation is that credit licensees must not suggest, assist with or provide a credit product that is unsuitable for a consumer.
Under the drafted regulation, brokers must make reasonable enquiries of the consumer about their requirements and objectives in relation to the credit contract; take reasonable steps to verify the consumer's financial situation and give the consumer a copy of the assessment if requested.
