What is Responsible Lending
Credit licensees must comply with the responsible lending conduct obligations in Ch 3 of the National Consumer Credit Protection Act 2009
The key concept is that credit licensees must not enter into a credit contract with a consumer, suggest a credit contract to a consumer or assist a consumer to apply for a credit contract if the credit contract is unsuitable for the consumer.
The responsible lending obligations involve:
making reasonable inquiries about the consumer’s financial situation, and their requirements and objectives;
taking reasonable steps to verify the consumer’s financial situation; and
making a preliminary assessment about whether the credit contract is ‘not unsuitable’ for the consumer.
In addition, we must be able to provide you with a written copy of the preliminary assessment or final assessment (as relevant).