This Brief Counsel is the fourth in our six-part series
on the interim report of the Australian Royal Commission into the
Banking, Superannuation and Financial Services Industry. This time
our focus is on the implications for small and medium sized
enterprises (SMEs).
SMEs account for 97% of all businesses in New Zealand
and contribute around 26% of GDP but here, and in Australia, are
almost entirely reliant on the voluntary Codes of Banking Practice
(the Code) for protection against irresponsible lending
practices.
Status quo to prevail
The Commission found that there was not much support for
substantial change to the current legal framework and did not reach
a conclusion that greater protection was needed. This may
reflect:
