Submission to Treasury: Buy Now Pay Later regulatory reforms
On 12th March 2024, the Australian Government Treasury released an exposure draft legislative package on the proposed regulation of Buy Now, Pay Later (BNPL) arrangements for public comment.
Kadre responded by acknowledging that our previous submission was ambitious in seeking broader changes to the Credit Act. However, we were pleased that the Treasury had taken steps to address issues we raised in our feedback relating to licensing, scalability and credit reporting.
In our view, the Treasury proposal still requires tweaking.
We do not agree with the $2,000 threshold for distinguishing between negative and partial credit reporting.
We are of the opinion that all BNPL providers should contribute and consume partial credit information at a minimum regardless of amount.
We also feel that BNPL providers should consider all credit liabilities of the customer as part of the assessment process rather than just “any low-cost credit contracts, small amount credit contracts or consumer leases to which the consumer is currently a party”.
While this would be a step in the right direction, there are still substantial changes required to the Part IIIA of the Privacy Act and to the Credit Act to deliver the expected efficiency or effectiveness improvements to the consumer credit ecosystem that we advocated for in the 2000’s.
We are hopeful that this will be addressed under the planned review of the credit reporting framework scheduled for October 2024.
Our submission is linked below:
https://lnkd.in/gQwaAsCF
