After a few false starts, mandatory consumer credit reporting gets underway on July 1, when large ADIs will have to start supplying comprehensive credit information.
A bill amending the National Consumer Credit Protection Act, to mandate comprehensive credit reporting by some financial institutions, was first introduced in 2018 and was passed in the House of Representatives.
It was not passed by the Senate before Parliament was prorogued for the election. It was reintroduced, with some changes, in December 2019.
It was finally passed in February this year. An ADI with more than A$100 billion of assets must supply mandatory credit information on 50 per cent of their consumer credit accounts within 90 days of 1 July 2021 to all credit reporting bodies they had an agreement with on 2 November 2017.
Within 90 days of 1 July 2022, the same credit providers need to supply credit information on their remaining consumer credit accounts to the same credit reporting bodies.
Beginning on 1 July 2022, the mandatory credit reporting regime will also require the same credit providers to supply financial hardship information about an individual, where available.
Disclosure of financial hardship information will be unrestricted in situations where a consumer is seeking to access new credit.
Its availability will be more limited in other situations, such as where a credit provider is seeking to collect payments that are overdue, a mortgage insurer is doing a risk assessment or to a credit provider assessing a loan guarantor.
The law also allows consumers to access their credit reporting information that is held by a credit reporting body free of charge every three months. Under the old rule a consumer could get their credit report free of charge every 12 months.
At the end of May, regulations were registered. These deal with the supply of repayment history information, circumstances where a credit reporting body is restricted from disclosing information, reporting requirements and penalties for infringements.
The mandatory comprehensive credit reporting parts of the bill are largely redundant. According to the Australian Retail Credit Association, 95 per cent of consumer credit accounts are being reported on a comprehensive basis.