ob体育 has extended for a further two-year period to 1聽April 2024. The class order relieves credit providers and lessors from the obligation to provide written notice to consumers about hardship contract variations of 90 days or less (known as 鈥榮imple arrangements鈥�).
The relief was due to expire on 1 March 2022 and has been extended by .
Consultation process
The relief was extended following public consultation through Consultation Paper 354 ob体育 relief for simple arrangements following a hardship notice: [CO 14/41] (CP 354), issued on 8 December 2021.
We received six non-confidential submissions (CP 354) which have been published on ob体育鈥檚 website. Submissions from industry bodies indicate that:
- even when relief under [CO 14/41] is available, credit providers often provide written notice to consumers; and
- there exist some circumstances where credit providers benefit from the additional flexibility afforded by the relief so that they can respond quickly to consumers experiencing financial difficulties.
While ob体育 recognises that consumer organisations consider that the class order should be allowed to expire, ob体育 considers that this class order remains appropriate to support credit providers to be able to quickly offer temporary assistance to consumers, particularly as consumers continue to be impacted by the financial consequences of COVID.
In addition, ob体育 considers the extension of [CO 14/41] will give the Government time to consider whether this relief should be made permanent through modifications to the requirements of the National Credit Code.
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Background
ob体育 is the national regulator for consumer credit and consumer leases under the national credit legislation.
Under the National Credit Code, a consumer experiencing financial difficulties may notify their credit provider/lessor that they are unable to meet their repayment obligations (i.e. a hardship notice). The credit provider/lessor must respond by either agreeing to or declining to change the contract and provide written notification to the consumer about their decision.
The exemption from the written notification requirement for simple arrangements was introduced in 2013 following changes to the hardship provisions of the National Credit Act.
ob体育's Moneysmart website has guidance for consumers in .