"Small Loan Providers Caught On The Hop"

Dec 05 2016

"Small Loan Providers Caught On The Hop"

 An article in today's Australian points out some real consequences of the government's acceptance of rcecmmendations coming from the review into the NCCP Act concerning new legislation which started in July 2013.

"...Canberra’s long-awaited measures to rein in the “small amount consumer credit” sector drive the knife into the twitching body of a clinically dead sector."

The article points out that ASX listed companies operating in the small amount credit contract (SACC) sector, "have already moved to accommodate the regulatory clampdown."  But the industry as a whole was, "caught on the hop last week when relevant minister of the crown, Kelly O’Dwyer, accepted most of the 24 recommendations of the independent panel."

The article furhter reports on the acceptance of a recommendation to reduce to a maximum of 10% of their income that allconsumers (not just benefit recipients) can commit to repayments..  The “unintended consequences’’ of this new restriction is of customers "having to take out longer loans and ultimately pay more interest.'.  In other words, SACC loans will be more costly for consumers under these new recommendations.

CLICK HERE to read the full article in The Australian or refer to the pdf at the bottom of this page.