Government-led Senate Committee backs strengthening consumer protections for predatory payday loans and high-cost leases
MEDIA RELEASE CALC 22 SEPT 2020
A Senate Committee has handed down its final report on proposed reforms to payday loans and consumer leases in the National Consumer Credit Protection Amendment (Small Amount Credit Contract and Consumer Lease Reforms) Bill 2019 (No. 2), otherwise known as the SACC Bill.
The Committee recommended the Government 'progress sensible reform and strengthen regulation in the area of small amount credit contracts and consumer leases'. The Committee also recommended removing consumer leases from Centrelink's bill paying service Centrepay."It's promising to read the Government is still committed to progressing reforms to payday loans and consumer leases," says Gerard Brody, Consumer Action CEO.
"With the ongoing economic fallout of COVID-19 and the winding back of support measures, it is absolutely critical the Government implements measures to protect people from exploitive lenders seeking to take advantage of their financial vulnerability."The Committee's report demonstrates cross-party support for enhanced consumer protections in relation to these high-cost credit products. The evidence of the harm under the current law is clear, and has been allowed to go on for far too long.
"Implementing these reforms would ensure people have enough money to pay for rent and food after making loan repayments, and help stop Australians from falling into debt spirals caused by payday loans and consumer leases.
"The Government now has a window of opportunity to get these protections in place before we start seeing a spike in people turning to predatory lenders just to make ends meet. The time to act is now," said Mr Brody.
|Tags: Australian Consumer Law Responsible Lending CALC Consumer Action Law Centre Rogue Lending Stop the debt trap Small amount credit contracts Payday loans Consumer leases|