New credit regime takes a hard line
The Federal Government has released its draft National Consumer Credit Protection Bill to “modernise” Australia’s financial services sector.
Superannuation Minister Nick Sherry says the Bill will enforce higher standards of conduct on credit providers and advisers than exist at any state or territory level.
If the Bill passes it will create the Australian Credit Licence, which will require holders to meet a set of minimum standards before they can operate and will come into effect from the beginning of next year.
Under the Bill all banks, credit unions, finance companies and other lenders will be required to be licensed.
The licensing regime will be supervised by ASIC and is expected to replace the numerous regulatory regimes that exist across the states and territories.
ASIC says it will employ an extra 200 people – subsidised by the $66 million it will receive from the Government – to administer the regime.
“Providers or advisers who break the rules face tough penalties, including hefty fines, a loss of licence and even jail time,” Senator Sherry said.
“ASIC will be given the power to promptly cancel or suspend a licence or ban people from engaging in credit activities where it is necessary to protect consumers from the risk of financial harm and to maintain the integrity of the credit market.”
Superannuation Minister Nick Sherry says the Bill will enforce higher standards of conduct on credit providers and advisers than exist at any state or territory level.
If the Bill passes it will create the Australian Credit Licence, which will require holders to meet a set of minimum standards before they can operate and will come into effect from the beginning of next year.
Under the Bill all banks, credit unions, finance companies and other lenders will be required to be licensed.
The licensing regime will be supervised by ASIC and is expected to replace the numerous regulatory regimes that exist across the states and territories.
ASIC says it will employ an extra 200 people – subsidised by the $66 million it will receive from the Government – to administer the regime.
“Providers or advisers who break the rules face tough penalties, including hefty fines, a loss of licence and even jail time,” Senator Sherry said.
“ASIC will be given the power to promptly cancel or suspend a licence or ban people from engaging in credit activities where it is necessary to protect consumers from the risk of financial harm and to maintain the integrity of the credit market.”