Treasury has released an exposure draft of the National Consumer Credit Protection Amendment (Financial Sector Reform) Regulations 2023 which will implement the changes made by the Financial Sector Reform Act 2022 to the regulation of small amount credit contracts (SACCs) and consumer leases.

Background.

The matters addressed by the Regulations are as follows:
• adding an additional requirement that licensees verify the financial situation of consumers before entering into a contract with them;
• consumer income requirements for both SACCs and consumer leases for household goods;
• anti-avoidance measures targeted at avoidance purposes relating to credit contracts and product intervention orders;
• the prescription of new civil penalties subject to the National Credit Act infringement notice regime;
• disclosure of information requirements for consumer leases for household goods;
• the calculation method for the base price of goods hired under a consumer lease;
and
• early termination fee principles for consumer leases for household goods.

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