Ministry of Consumer Affairs
The New Zealand Bankers’ Association (NZBA) is writing to provide comments on:
- issues raised by the Ministry of Consumer Affairs (MCA) regarding Credit Reform in New Zealand at a meeting with NZBA staff on 6 September; and
- Proposed Key Policy Principles, new and amended provisions for the Credit Contracts and Consumer Finance Act (Key Policy Principles), provided to Presenters, Chairs and Commentators.
NZBA understands from discussions with officials and from participation in the August 2011 Financial Summit (Summit) that the target of reforms is the business activities of fringe lenders. NZBA supports this objective and would like to work with the Ministry of Consumer Affairs (MCA) in relation to any reform required to achieve this objective.
NZBA notes that there has been little time in which to analyse the policy proposals. Many of the proposals are new, having not been canvassed in MCA’s 2009 Discussion Document on Consumer Credit Law or at the Summit. Therefore the comments in this letter are made at a high level and cannot be considered as definitive.
Accordingly, NZBA supports the release of an exposure draft of any amendments to the Credit Contracts and Consumer Finance Act 2003 (CCCFA) for public comment before any amendment bill is introduced. NZBA also suggests that further consultation and analysis be conducted before the details of policy decisions are made. This will be vital if unintended consequences and unnecessary compliance costs are to be avoided, given the complex nature of the relevant laws.