We were recently reviewing ASIC’s RG209, which sets out the steps you can take to minimise the risk of non-compliance with these obligations, when we spotted the following note on ASIC’s URL:

Note: On 25 September 2020, the Government announced proposed reforms to the responsible lending obligations contained in Chapter 3 of the National Credit Act. The proposed reforms will amend the obligations that apply before entry into a credit product or the provision of credit assistance. ASIC’s guidance relating to the current responsible lending obligations will be reviewed and updated when the proposed reforms are finalised.

We have noticed, and perhaps it’s just us, a softening from our Credit Providers of their requirements from a responsible lending perspective, which without these changes, makes us uncomfortable that we are not always complying with the guidance in RG209, particularly around taking steps to verify.

With politicians returning to parliament for the Spring sittings, usually between August and December, we remain hopeful that these reforms, announced 3 years ago, will progress and we see a simplification of these obligations.

We will keep you updated here as this progresses.

For more information, contact the team by emailing info@creditcomply.com.au.

From the 1st July 2023, all Australian Credit License (ACL) holders have an obligation to report their customer complaint data to ASIC.
Every six months, the reporting periods are:

• 1 January to 30 June, and
• 1 July to 31 December.

A two-month submission window opens at the end of each reporting period. You must submit an Internal Dispute Resolution (IDR) report to ASIC before the submission window closes, in a format prescribed by ASIC.

This requirement was a recommendation made following the Review of external dispute resolution and complaints arrangements in the financial system, also known as the Ramsay Review. It was this review which resulted in the establishment of AFCA. The AFCA Act amended financial services and credit laws and these legislative changes also provided ASIC with additional powers aimed at improving transparency around IDR:

• require financial firms to report their IDR activities to ASIC in accordance with ASIC requirements.
• give ASIC the power to determine, by way of legislative instrument, the content and form of IDR reporting by financial firms; and
• enable ASIC to publish the IDR data, including at the firm level.

This change is designed to improve the effectiveness of internal dispute resolution (IDR) through increased reporting of IDR activity to ASIC.

What should I do?
Now is a good time to make sure your internal dispute resolution (IDR) practices meet the requirements of ASIC Regulatory Guide 271: Internal Dispute Resolution and to make sure you have a good complaints management (IDR) process and practice.

We also recommend that you align your complaints register with the format that is prescribed by ASIC now so as to avoid delays in looking for data when the reporting period opens.

If you need help with your Complaints Policy, your IDR Procedures, or your Complaints Register, we would be happy to help.

Contact the team by emailing info@creditcomply.com.au.