CCLS welcomed the opportunity to comment on the Australian Investment and Securities Commission’s (ASIC) Draft Regulatory Guide 000 Low Cost Credit Contracts (Draft Guide).
Our submission draws on our experience assisting clients experiencing financial abuse through our Telephone Advice Line and Financial Abuse Legal Service.
The submission focuses on the need for explicit recognition of the relationship between financial abuse and consumer lending.
Our key recommendations include:
- Specifically addressing financial abuse in the Draft Guide and recognising its impact on credit reporting of financial hardship information.
- Reducing the risk of financial abuse in credit lending by incorporating further requirements on lenders and including specific examples acknowledging the signs and complexities of financial abuse and credit lending.
- Clarifying the modified responsible lending obligations to lenders by including specific guidance and examples and introducing requirements to make further inquiries and provide warnings.
We consider it critical that ASIC embed in the Guide from the outset the risks and associated harms that lenders are expected to identify and respond to.
You can read the submission in full here