Consumer credit Bill passes third reading
Published: 17 December 2019
The Credit Contracts Legislation Amendment Bill, which passed its third reading on 12 December 2019, contains new measures that better protect vulnerable consumers from loan sharks, truck shops and other predatory lenders.
The Bill’s passing follows the Government’s review of consumer credit law in 2018.
Measures in the Bill to protect vulnerable consumers include:
- a total cost of credit cap limiting the interest and fees charged on high-cost loans to 100% of the amount borrowed
- a rate cap limiting the amount that lenders can charge per day on interest and fees to 0.8%
- extending responsible lending requirements to credit provided by truck shops
- stiffer penalties for irresponsible lending
- enabling higher standards to ensure responsible advertising of high-cost loans
- requirements for lenders to undergo “fit and proper person” checks before they are allowed to operate.
The new legislation takes full effect from 1 April 2021.
Please note: This content will change over time and can go out of date.