LABOR STEPS UP TO TACKLE ‘BUY NOW PAY LATER’

CLARE O’NEIL MP.
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1 year ago
LABOR STEPS UP TO TACKLE ‘BUY NOW PAY LATER’
CLARE O’NEIL MP
Labor is announcing today that we will move to give ASIC new powers to protect consumers by including ‘buy now, pay later’ providers in the scope of new design and distribution obligations and product intervention powers.

Labor will move amendments in the Senate to the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2018 to include a greater range of financial products, including ‘buy now, pay later’ products and funeral expenses products, within the scope of both the design and distribution obligations and product intervention powers.

This change will dramatically improve consumer protection and regulatory oversight of ‘buy now, pay later’ products.

ASIC has asked for its new product intervention powers to be expanded to cover ‘buy now, pay later’ providers, and Labor has listened.

ASIC yesterday released a review of ‘buy now, pay later’ services, which highlights the desperate need for greater scrutiny of credit and financial services targeted at vulnerable Australians.

The report released by ASIC found that the rapid growth of ‘buy now, pay later’ services has resulted in almost $1 billion in outstanding buy now pay later balances. One in six users had either become overdrawn, delayed bill payments or borrowed additional money.

Unlike the out-of-touch Morrison Government, Labor is committed to protecting consumers.
That’s why Labor is moving swiftly to accept ASIC’s recommendations.

Labor has also established a Senate inquiry to examine the credit and financial services targeted at Australians at risk of financial hardship. The inquiry will examine whether the current regulation of debt management firms, payday lenders and ‘buy now, pay later’ providers is adequate to protect vulnerable members of the community from financial harm.

We are listening to customers, to experts and to regulators to make sure we get to the bottom of this issue. Financial counsellors are telling us that clients in financial hardship are at risk of spiralling debts due to compounding debts from small credit services – such as ‘buy now, pay later’.

The Liberals simply don’t care about protecting consumers. Scott Morrison voted 26 times against the Banking Royal Commission, calling it a “populist whinge” and a “QC’s complaints desk”. Liberals are divided, out of touch and only for the top end of town. They simply have no interest in protecting ordinary Australians from financial hardship.

Labor is committed to protecting vulnerable consumers from harm. We will continue to investigate these issues through the Senate Inquiry and ensure the law is protecting financially stressed Australians.