ASIC will hold public hearings as part of the wider public consultation on its guidance on the responsible lending obligations. This consultation commenced in February 2019, and ASIC has received 72 submissions. The hearings, which will be live streamed online, are aimed at testing the views of stakeholders and providing greater understanding of business operations.
‘The responsible provision of credit is critical to the Australian economy’ said ASIC Commissioner Sean Hughes. ‘We are taking this opportunity to test views to make sure our guidance remains relevant, clear and timely. Public hearings will provide a robust and transparent way to air issues and views raised in written submissions.’
The stakeholders invited to participate in the hearings will be drawn from the groups or individuals who provided a written submission to ASIC on the responsible lending guidance.
Of these submissions, 64 non-confidential submissions have been published on ASIC’s website. Submissions were received from a wide range of stakeholders representing different parts of the broad credit industry and consumer advocates, as well as a number of academic and legal adviser groups.
The public hearings will take place during August. The hearings will be held in Melbourne and Sydney, but may involve participants from other parts of Australia.
Regulatory Guide 209 Credit licensing: Responsible lending conduct (RG 209) contains ASIC’s guidance on responsible lending for consumer credit. RG 209 was issued in 2010 and last revised in November 2014.
Since then there have been many matters that now mean it is timely for ASIC to update its guidance, including:
- ASIC regulatory and enforcement actions, including court decisions
- ASIC thematic reviews on various parts of the industry such as interest-only loans
- the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry
- recent and upcoming initiatives such as comprehensive credit reporting and open banking, and
- changes in technology
In February 2019, ASIC released a Consultation Paper on updating its guidance. Our review of RG 209 will consider whether the guidance remains effective and identify changes and additions to the guidance that may help holders of an Australian credit licence to understand ASIC’s expectations for complying with the responsible lending obligations. CP 309 contains a number of proposals for changes to be considered during this update. Written submissions were due on 20 May 2019.
Information about the consultation and its progress is available on the ASIC website.