New laws to restrict lending

The proposed commonwealth consumer credit code will weed out many smaller lending companies and leave many people without access to any credit at all says the industry group representing short term lenders and pawn brokers.

"The smaller players – some of the mum and dad operators are going to face a really hard road," says Phil Johns, chief executive of the National Financial Services Federation.

"Some people in the community will just not be able to get credit, and that is not necessarily a good thing. Research from the USA indicates that in states where short term lending has been severely restricted, insolvencies go up – our industry acts like a pressure valve."

Source: The Sheet