13412 (2024). Scott Willis to the Minister of Commerce and Consumer Affairs

13412 (2024). Scott Willis to the Minister of Commerce and Consumer Affairs: What plans, if any, does the Minister have to ensure that the proposed removal of the “overly prescriptive affordability regulations” from the Credit Contracts and Consumer Finance Act 2003, will not lead to irresponsible lending practices that could harm consumers?

Hon Andrew Bayly: Lenders will continue to be required by section 9C of the Credit Contracts and Consumer Finance Act 2003 (CCCFA) to meet ‘lender responsibility principles’, including the requirement to be satisfied by reasonable inquiries that any loan is likely to be affordable. Lenders are also required to keep records of inquiries they have made into affordability and the results of those inquiries. Lenders can face a range of consequences for failure to meet these obligations. Furthermore, I have directed the Ministry of Business, Innovation and Employment to develop new guidance in Chapter 5 of the Responsible Lending Code, so that lenders are supported to responsibly assess affordability. One of the objectives for these revisions to Chapter 5 is to continue to protect consumers from unaffordable credit. I am presently consulting the public on the proposed changes to the Code, until 10 June. You can find out more about this consultation, and have your say, here: https://www.mbie.govt.nz/have-your-say/proposed-changes-to-the-responsible-lending-code.