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February 28, 2013

Who can report overdue payments and get credit reports?

To can gain access to credit reports and list overdue payments and serious credit infringements the Privacy Act requires a business to be a "credit provider".

The definition of “credit provider” for credit reporting purposes is wider than the National Consumer Credit Protection Act definition which requires consumer credit providers to be licensed.

In the past there has been concern that service providers such as Telstra can list debts with credit reporting agencies.

Will this change under the amendments which commence on 12 March 2014? No.

To list credit defaults and obtain credit reports the amendments define a "credit provider" under new sections 6G-6K.

A credit provider includes:

  • a bank,
  • an entity where a substantial part of its business is the provision of credit,
  • a retailer that issues a credit card in connection with sale of goods or supply of services,
  • a supplier which provides credit in relation to sale of goods or supply of services where repayment of credit is deferred for at least 7 days,
  • a lessor who provides credit in connection with hiring, leasing or renting of goods and credit is in force for at least 7 days.

A securitisation entity is also a credit provider in relation to credit it deals with.

An acquirer of credit becomes a credit provider in relation to that credit.

However only ASIC licensed consumer credit providers and mortgage insurers will be able to pass on and obtain "repayment history information".

The following organisations or small business operators are not credit providers for credit reporting purposes:
(a) a real estate agent; or
(b) a general insurer (within the meaning of the Insurance Act 1973); or
(c) an employer of an individual.

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Posted 28th February 2013 by David Jacobson in Consumer Law, Financial Services, Privacy