We are naturally pleased that there is no finding of market failure in the commercial broker channel which CAFBA represents.
We are very pleased that the Royal Commission has recommended that the National Consumer Credit Protection Act (NCCP Act) should not extend to small business lending and that the Point of Sale Exemption of NCCP should be removed.
CAFBA has strongly advocated for these changes to government and regulators for many years as well as directly to the Royal Commissioner and we welcome the Government’s support of these recommendations.
CAFBA will now examine the document in detail to ensure that remedies proposed for consumer borrowers do not impact on our ability to deliver workable outcomes for business borrowers. More analysis needs to be done on the recommended changes to mortgage broker remuneration in the consumer home loan space, to ensure competition with banks is not diminished, or rural consumers are potentially denied access to competitive home loan products.
CAFBA President David Gandolfo said today:
“CAFBA members are career professionals who are interested in the best possible outcomes for their business customers, and they don’t want their customers to be impacted by new regulations and remedies that are intended for an entirely different area of the financial services sector.”
Regulators, bankers and policy makers need to be careful to make the correct distinctions - as Commissioner Hayne has carefully done - when responding to issues raised in the Royal Commission. We want to make sure that these reforms are introduced in such a way so as not to impede access to finance for small and medium enterprises.
We now have the final blueprint of the road ahead, and no longer need to speculate on what compliance obligations might look like in the future.”