Credit Unions and Building Societies welcome credit reforms, urge effective targeting

29 September 2006

Credit unions and mutual building societies have welcomed moves by the Victorian Government to protect vulnerable consumers and address poor lending practices.

Victoria has announced its Government Response to the Report of the Consumer Credit Review.

“Victoria is proposing that all credit providers belong to an Alternative Dispute Resolution (ADR) scheme and to improve regulatory oversight of credit providers,” said Adrian Lovney general manager Abacus – Australian Mutuals.

“These measures will bring lightly-regulated credit providers more into line with the consumer protection obligations covering mainstream lenders.

“Victoria is also proposing improving access to No Interest Loan Schemes (NILS) – work credit unions already deliver – and arming the consumer affairs regulator with more flexible powers to pursue dodgy credit providers.

“These are welcome measures that we, as responsible lenders, fully support.

“Other measures, such as those relating to credit advertising practices and addressing the cost of credit, are well motivated but Abacus believes further consultation is needed to ensure they are effectively targeted.

“Abacus supports reform that is targeted at the sharp operators who pose the most risk to consumers.

“Abacus also urges credit market regulators to make every effort to deliver nationally-consistent solutions to maintain the strength and uniformity of credit regulation across Australia.

“Australia’s credit unions and mutual building societies have a strong history responsible lending. This is not a new marketing slogan or a response to regulatory pressure but is part of the mutual sector’s DNA as member-owned organisations.”

For more information contact:

Louise Petschler
Head of Public Affairs
Abacus – Australian Mutuals
02 8299 9050 or 0408 239 226