The regulators, laws and obligations that govern lending in Australia.
39 terms in this topic
The ACCC is the Australian Competition and Consumer Commission, the national regulator that enforces competition and consumer law, covering misleading conduct, cartels, product safety and unfair contract terms.
Read definitionAnti-money laundering (AML) is the set of laws, controls and processes designed to stop criminals turning the proceeds of crime into apparently legitimate funds, enforced in Australia by AUSTRAC.
Read definitionAPRA is the Australian Prudential Regulation Authority, the statutory regulator responsible for prudential regulation of banks, credit unions, insurers and superannuation funds, protecting depositors, policyholders and fund members.
Read definitionASIC is the Australian Securities and Investments Commission, the regulator for companies, markets, financial services and consumer credit, which licenses providers, keeps public registers and enforces conduct laws.
Read definitionThe ATO is the Australian Taxation Office, the national tax authority that collects income tax, GST and PAYG, administers superannuation rules, issues rulings and enforces compliance.
Read definitionAUSTRAC is Australia's financial intelligence unit and anti-money laundering regulator: it collects reports from regulated businesses, analyses them and supervises reporting entities under the AML/CTF Act.
Read definitionAn Australian credit licence (ACL) is the authorisation from ASIC that a business needs to provide consumer credit or credit assistance under the National Consumer Credit Protection Act.
Read definitionThe best interests duty is a statutory obligation requiring financial advisers giving personal advice and mortgage brokers arranging credit to put the customer's interests first.
Read definitionCompliance is the work a business does to meet the laws, licence conditions and industry rules that apply to it, and to prove it has.
Read definitionConsumer credit is a loan, credit card, consumer lease or other credit provided mainly for personal, household or domestic purposes and regulated by the National Credit Code.
Read definitionCounter-terrorism finance (CTF) is the set of controls that prevent, detect and cut off funds flowing to terrorists, which Australian reporting entities must apply under the AML/CTF Act.
Read definitionA credit guide is a prescribed disclosure document that a broker or credit licensee must give a consumer before providing credit assistance, covering licence details, remuneration and complaints handling.
Read definitionData protection is the legal duty of brokers and lenders to handle customers' personal information under the Privacy Act and the Australian Privacy Principles, from collection to secure destruction.
Read definitionDebt collection regulations are the laws, guidance and licensing rules that govern how creditors and collectors may behave when recovering money owed, including bans on harassment and misleading conduct.
Read definitionDesign and distribution obligations (DDO) are rules requiring the issuer of a retail financial product to define its target market and distributors to take reasonable steps to sell within it.
Read definitionEthics in lending is the set of conduct standards that shape how brokers and lenders treat borrowers, manage conflicts of interest and make decisions beyond what the law requires.
Read definitionA financial services guide (FSG) is the plain-language disclosure document a licensed financial firm gives retail clients, explaining its services, how it is paid and how to complain.
Read definitionForeign Investment Review Board (FIRB) approval is the statutory permission a foreign person may need before acquiring Australian land, property or business interests covered by foreign investment law.
Read definitionFraud is deliberate deception or misrepresentation intended to secure an unfair or unlawful gain or cause loss, such as false documents on a loan application.
Read definitionAn HPI check is a vehicle history and finance check that shows whether a used car has outstanding finance registered against it, or a stolen or written-off record.
Read definitionInvoice fraud is a type of fraud in which criminals send fake or altered invoices, or bogus bank-detail changes, to trick a business into paying an account they control.
Read definitionKnow your customer (KYC) is the process a reporting entity uses to identify and verify a customer, understand their business and assess the money laundering and terrorism financing risk.
Read definitionAn LMCT (licensed motor car trader) is a dealer licensed under Victoria's Motor Car Traders Act to buy, sell or exchange vehicles as a business, giving buyers statutory protections.
Read definitionA medium amount credit contract (MACC) is a non-bank consumer credit contract for more than $2,000 and up to $5,000, running from 16 days to two years.
Read definitionMoney laundering is the process of disguising the origin, movement or ownership of money made from crime so that it appears legitimate and can be used openly.
Read definitionThe NCCP Act is Australia's National Consumer Credit Protection Act 2009, the law that licenses credit providers and brokers and sets responsible lending and disclosure rules for consumer credit.
Read definitionThe OAIC is the Office of the Australian Information Commissioner, Australia's independent privacy regulator, which enforces the Privacy Act, the Australian Privacy Principles and the Notifiable Data Breaches scheme.
Read definitionPolitically exposed person (PEP) checks are screening steps that flag customers who hold prominent public positions, so a lender can apply extra due diligence under anti-money laundering laws.
Read definitionThe Privacy Act 1988 is the Australian law that sets out how government agencies and many organisations must collect, use, disclose and correct personal information, including credit reporting data.
Read definitionA product disclosure statement (PDS) is the document a product issuer must give a retail customer before they buy a financial product, setting out its features, risks, fees and costs.
Read definitionPrudential regulation is APRA's framework of capital and risk rules designed to keep banks, insurers and superannuation funds financially sound, and it shapes how much they lend.
Read definitionThe RBA (Reserve Bank of Australia) is Australia's central bank: it sets the cash rate that flows through to loan and savings rates, and operates key payment settlement systems.
Read definitionResponsible lending obligations are duties under the NCCP Act that require lenders and brokers to inquire into and verify a consumer's finances and not provide or suggest unsuitable credit.
Read definitionRisk weighting is the method banks use to scale each asset by how risky it is, so riskier lending requires more capital behind it.
Read definitionSanctions checks are screening steps that test whether a person, company or transaction is subject to government sanctions, such as asset freezes, before a lender deals with them.
Read definitionSelf-regulation is the practice of an industry setting and enforcing its own conduct standards through voluntary codes rather than legislation; it is how most Australian commercial finance is governed.
Read definitionA small amount credit contract (SACC) is the statutory label for a small, short-term, unsecured consumer loan from a non-bank lender, typically a payday loan, with capped fees.
Read definitionUnfair contract terms are clauses in a standard form contract that significantly favour one party, are not reasonably necessary to protect that party, and would cause detriment.
Read definitionAn unregulated agreement is a loan or other credit arrangement that sits outside the NCCP Act, usually because the credit is wholly or mainly for business purposes.
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