ASIC consults on updating its responsible lending guidance

ASIC has issued a consultation paper to update its guidance on responsible lending and is seeking feedback on proposed changes.

ASIC’s guidance has been in place since 2010, when the responsible lending laws were first introduced. Although the laws have not changed since 2010, ASIC said 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 recent final report of the royal commission.

"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," the commission said.

It noted that the consultation paper asks a series of question about specific matters and has invited interested parties to give their recommendations on any other issues considered important that are not dealt with in the consultation paper.

ASIC added it 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.

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

"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," he added.

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