The Australian Finance Industry Association (AFIA) has published its Code of Practice which will be effective from 1 October 2026.
It will apply to credit, finance and novated lease products and services issued by its members to Consumer and Small Business customers in Australia, and their guarantors and co-borrowers, subject to the exclusions set out in the Code.
These products include but are not limited to:
a. secured and unsecured consumer finance, including credit cards, personal loans, lines of credit or overdrafts, mortgages for residential and investment purposes (including home loans and chattel mortgages) and vehicle finance;
b. secured and unsecured business finance, including lines of credit, debtor and cashflow finance, asset and equipment finance, fleet and vehicle finance; and
c. novated leases.
The Code does not apply to products that AFIA members provide to commercial property, government, or semi-government customers, or large corporate customers. The Code also does not apply to bailment facilities.
The Code does not apply to AFIA Members who provide commercial finance predominantly for large commercial vehicles and equipment manufactured by their company or an associated company, such as trucks and machinery used in transport, construction, mining and resources, farming and agriculture.
AFIA has also issued Guidelines for Domestic and Family Violence and Financial Abuse, Supporting Customers Experiencing Financial Difficulty and Supporting Customers Experiencing Vulnerability.
Compliance with the Code is subject to transitional arrangements until 1 October 2026. The Code will apply to a new product or a guarantee for which customers enter into an agreement on or after that date.
AFIA has separate codes of practice for Buy Now Pay Later (BNPL Code), Online Small Business Lenders (AOSBL Code) and Insurance Premium Funding (IPF Code).
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
