Applicants for the new Australian Credit License will find that they need to pass very strict new compliance reviews. Applicant will be required to pass rigorous checks to ensure their credit license applications are accurate as the corporate regulator steps up its enforcement of a new national credit regime.
Since the first of July, 2010, ASIC has issued 11 regulatory guides and 9 information sheets to help businesses understand their obligations.
“Going forward, our focus is on smoothly transitioning the industry to the new credit regime and ensuring our oversight of the industry is effective,” ASIC chairman Tony D’Aloisio will tell an American Chamber of Commerce lunch in Melbourne today.
ASIC has taken on the responsibility of ensuring that all brokers, non-bank lenders and non-registered finance companies offering home and personal loans, credit cards, leases, overdrafts and line-of-credit accounts do so responsibly. More than 14,700 credit businesses have registered with ASIC under the regime and the regulator has issued 132 licences.
More than 400 credit licence applications have been received.
Credit providers had until June 30 to register under the laws and they now have until December 31 to apply for a credit licence or face penalties.
Mr D’Aloisio will reveal today that ASIC plans to police the application of responsible lending obligations to credit-card applications and credit-card limit increases, and will undertake risk-based compliance reviews of credit businesses.
ASIC also intends to carry out “verification surveillances” to make sure the information in the credit licence applications is accurate and to ensure credit providers are not operating outside the system, “either intentionally or inadvertently”.