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ARTICLE · 17 JUNE 2023

ASIC's Enforcement Action On Responsible Lending Practices

Sophie Grace Pty Ltd
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ACL holders must properly assess whether consumers can meet repayment obligations, before entering into loan contracts.

AustraliaFinance and Banking
Victoria Pasquale
Victoria Pasquale
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In May 2023, ASIC commenced proceedings against Money3 Loans Pty Ltd in relation to their responsible lending obligations when providing finance for the purchase of second-hand vehicles.

Australian Credit Licence holders have an obligation to ensure that they do not suggest or assist a consumer to apply for a credit contract/consumer lease if that credit contract/consumer lease is unsuitable for the consumer. In meeting this obligation, credit licensees must obtain information regarding the purpose of the loan or consumer lease to appropriately assess whether the loan or consumer lease adequately meets the consumer's needs and objectives.

Summary of ASIC's Enforcement Action:

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