The Turnbull Government has today released exposure draft legislation and explanatory material for the credit card reforms announced by the Government in the 2017-18 Budget.
It is vital that we protect vulnerable Australians from predatory behaviour which seeks to make a quick buck from people’s misfortune, and compound their financial hardship.
The reforms will help ensure that consumers can manage their credit card debts and help prevent the debt cycle that many Australians find themselves in. In addition it will prohibit the overly complex and unfair way in which interest is calculated on many credit cards.
The exposure draft legislation outlines the Government’s commitment to implementing the first phase of reforms outlined in the Government’s response to the Senate Inquiry into the credit card market. These reforms include:
- requiring affordability assessments be based on a consumer’s ability to repay the credit limit within a reasonable period;
- banning unsolicited offers of credit limit increases;
- simplifying how interest is calculated; and
- requiring online options to cancel cards or to reduce credit limits.
The Exposure Draft Bill and Explanatory Memorandum are available on the Treasury website.