AFIA releases updated Online Small Business Lenders' Code of Practice
2 December 2022
The Australian Finance Industry Association today released the updated Online Small Business Lenders Code of Practice following a formal review process.
Diane Tate, Chief Executive Officer at AFIA, thanked all those who took the time to respond to the review and said the Code signatories remained committed to further improving the Code for the benefit of their customers.
“The providers of online small business loans are critical in ensuring the flow of working capital to small businesses and supporting Australia’s economic growth.
“Our data shows the Code is working well. While the number of small businesses accessing online unsecured loans from Code signatories increased 79.6% and the value of receivables increased 121.9% in the period 1 July 2020 to 1 July 2022, over the same period IDR complaints per 1,000 customers decreased by 56.6% and EDR complaints per 1,000 customers decreased by 11.2%.
“Code signatories have voluntarily been members of AFCA since inception of the Code to support efficient and low-cost dispute resolution for customers, which is above and beyond what the law requires.
“As a result of feedback received during the review process, the Code now includes additional commitments around the standard of internal dispute resolution services and financial hardship arrangements.
“The Code is reviewed every three years and during the past period the industry has seen major changes, with the COVID-19 global pandemic causing disruptions to the operations of small businesses, while also accelerating the digitisation of our economy.
“The Code has been updated to ensure we improve industry standards and protections for small business customers and continue to deliver high levels of transparency and disclosure.
“Voluntary industry codes are an important part of our regulatory framework because they can evolve over time to more quickly keep pace with changing consumer expectations and the regulatory and economic environment and more effectively lift industry standards to best practices.”
ENDS