Firms offering debt management services require credit licence to operateMay 5, 2021

ASIC has today released an information sheet for providers of debt management services that explains their new regulatory obligations, including the requirement to be licensed. The National Consumer Credit Protection Amendment (Debt Management Services) Regulations 2021 (Regulations), made on 29 April 2021, prescribe certain debt management services as a ‘credit activity’ for the purposes of the National Consumer Credit Protection Act 2009 (National Credit Act). Under the Regulations, a ‘debt management service’ broadly covers services such as ‘credit repair’ and ‘debt negotiation’ that are carried out in relation to a consumer credit contract and where a consumer is required to pay.From 1 July 2021, subject to transitional arrangements, providers of debt management services must hold a credit licence with an authorisation that covers debt management services. The transitional arrangements allow for the continued provision of debt management services while a provider is actively taking steps to be covered by a credit licence.

refer attached>>>info254-published-5-may-2021

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