Credit Reforms Need to Go Further
03 June 2008
Credit unions and mutual building societies welcome the release today of the Government’s Green Paper on Financial Services and Credit Reform but urge the Government to consider moving all credit products to the Federal jurisdiction.
The Green Paper released by the Minister for Superannuation and Corporate Law, Senator the Hon Nick Sherry outlines proposals to transfer the regulation of mortgage products, brokers and non-ADI [1] lenders from the States to the Commonwealth.
“Abacus welcomes these moves and whole-heartedly supports consistent and uniform regulation of mortgage products, and particularly of mortgage brokers and non-ADI lenders,” said Abacus CEO Louise Petschler.
“This will protect consumers and bring unregulated lenders and brokers into an appropriate consumer protection regime.
“But we urge the Government to go further and apply the same principles to all credit products, not just mortgages. A uniform and consistent framework that covers all lenders and protects all borrowers should be the aim.”
Abacus – Australian Mutuals is the industry body for Australia’s credit unions and mutual building societies. There are 142 credit unions and mutual building societies in Australia with more than 4.5 million members and total assets of around $65 billion.
“Credit unions and mutual building societies naturally support sensible consumer protection measures – we are already responsible lending institutions. We encourage the Government to apply the proposals to all credit products and force (currently) unregulated non-ADI lenders to subscribe to minimum consumer protection standards.”
Abacus looks forward to working with the Government on the reform proposals and will be making a submission on behalf of its member credit unions and mutual building societies.
Contact:
Louise Petschler
Chief Executive Officer
02 8299 9036; 0408 239 226
Mark Degotardi
Head of Public Affairs
02 8299 9053; 0419 998 201
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[1] ADI – Authorised Deposit-Taking Institution, licensed under the Banking Act
