ASIC to update responsible lending guidance

The Australian Securities and Investments Commission (ASIC) has issued a consultation paper to update its guidance on responsible lending. 

ASIC’s guidance has been in place since 2010 when the responsible lending laws were first introduced but has not changed since its inception. 

The regulator has claimed that it “considers it timely” to review and update the guidance in light of its regulatory and enforcement work since 2011, changes in technology, and the release of the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry,

ASIC added that its review of RG 209 will consider whether the guidance “remains effective” and will seek to 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”.

Submissions on the update of ASIC’s guidance on responsible lending have been welcomed from any interested parties.

In its consultation paper, the corporate watchdog has asked a series of questions about specific matters, with ASIC adding that it is “keen to hear from stakeholders about any other issues considered important” that are not dealt with in the consultation paper.

ASIC is also considering whether to provide an opportunity for key stakeholders to speak to the commission at public hearings in addition to making written submissions.

Further information about the consultation and its progress will be available on the ASIC website.

“The responsible lending obligations are an integral part of the regulatory framework for all consumer loans,” ASIC Commissioner Sean Hughes said.

“ASIC wants to ensure its guidance provides industry with certainty, including as a result of emerging technology and initiatives such as open banking and comprehensive credit reporting. We encourage everybody to participate in this extensive consultation process.”

The consultation is open for a period of three months, with comments due by Monday, 20 May 2019.

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