Cash Converters to refund $10.8 million in fees to payday loan customers

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Source: http://www.abc.net.au/news/2016-11-09/cash-converters-to-refund-millions-to-consumers-payday-loans/8008372

ASIC’s recent investigation raised concerns that Cash Converters may have breached its responsible lending obligations.

ASIC’s concerns included that Cash Converters did not make reasonable inquiries into consumers’ income and expenses, particularly where the consumer had two or more payday loans in the 90 days before taking out another payday loan through Cash Converters’ website.

ASIC also had concerns that Cash Converters did not take reasonable steps to verify consumers’ expenses, as the law requires, because it used an internal benchmark and did not take into account consumers’ actual expenses.

Following the investigation, Cash Converters paid $1.35 million in penalties and also agreed to refund $10.8 million to customers affected under around 118,000 small amount credit contracts.

Consumer Credit Legal Service (WA) Inc. recently assisted an elderly Aboriginal pensioner who had taken out 5 payday over 4 years totaling more than $14,000.

Consumers that have entered into loan contracts with Cash Converters that are unsuitable may be able to claim a refund, or lodge a complaint with the Credit and Investments Ombudsman.

To determine whether Cash Converters owes you a refund, you can visit ASIC’s Money Smart website at https://www.moneysmart.gov.au/tools-and-resources/news/cash-converters-refunds 

Or call the CCLSWA telephone advice line on 9221 7066.

For more information see:

http://www.abc.net.au/news/2016-11-09/cash-converters-to-refund-millions-to-consumers-payday-loans/8008372

http://asic.gov.au/about-asic/media-centre/find-a-media-release/2016-releases/16-380mr-cash-converters-to-pay-over-12m-following-asic-probe/

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CCLSWA Admin