Credit providers

Transfer of responsibility for regulation of consumer credit

In March 2024, Cabinet approved the transfer of responsibility for regulating the Credit Contracts and Consumer Finance Act (CCCF Act) from the Commerce Commission (Commission) to the Financial Markets Authority (FMA).

Advertising

If you are a lender under a consumer credit contract, this page will help you understand your obligations in relation to your advertising.

Annual Return

Lenders must provide an annual return to the Commission containing information about loans entered during the year.

Assessing for affordability

When providing consumer credit lenders must comply with the lender responsibility relating to affordability.

Assessing for suitability

When providing consumer credit lenders must comply with the lender responsibility relating to suitability.

Buy Now Pay Later

From 2 September 2024, Buy Now Pay Later lenders need to comply with all the obligations of a lender under the Credit Contracts and Consumer Finance Act 2003 (the Act) and the Credit Contracts and Consumer Finance Regulations 2004 (the Regulations), unless an exemption applies.

Buy-back transactions

A buy-back transaction is where a homeowner transfers their home (or an interest in their home) to a transferee, who typically pays their debts or gives them money. The former homeowner has the right to continue living in the home and to buy it back at some time in the future.

Changes to credit laws

There have been a number of changes to credit laws since 2019 which are set out in the timeline below.

Charging interest

There are rules about how you can calculate and charge a borrower interest or default interest.

Consumer credit fees

When you lend money, the Credit Contracts and Consumer Finance Act has rules you must follow when setting your fees.

Consumer leases

If you are in the business of leasing goods to consumers for their personal or household use, you may have to comply with credit laws.

Credit Pānui for Lenders

This quarterly pānui updates lenders on all the latest news from the Credit branch.

Disclosure obligations

You must provide key information to borrowers before a loan is entered into, and at certain times during its life.

Due diligence duties for directors and senior managers

From 1 December 2021, directors or senior managers of a consumer credit provider and/or mobile trader selling goods on credit need to comply with the due diligence duty.

Fit and Proper Person certification

If you lend money to consumers – including through pawnbroking, leases, buy now pay later, or mobile trading – and you're not already licensed by the Financial Markets Authority or Reserve Bank, you must be certified by the Commerce Commission under the Credit Contracts and Consumer Finance Act.

Hardship applications

If a borrower makes a hardship application, you are required to consider it and follow a specific process.

High cost loans

If you provide high-loans, there are specific rules that you will need to comply with from 1 June 2020.

Lender responsibility principles

When providing credit, you must ensure you comply with the lender responsibility principles. The lender responsibility principles impose obligations on lenders when advertising, before entering into a loan, and during all subsequent dealings with borrowers and guarantors.

Lending online

It does not matter how a loan is made – whether it is online, in person, on the phone or by text or email, the lender responsibility principles apply.

Pawnbroking

Pawnbroking contracts are considered consumer credit contracts under the Credit Contracts and Consumer Finance Act (CCCF Act) and pawnbrokers must comply with the obligations of a lender under a consumer credit contract unless exempt.

Publication of contract and cost of borrowing

If you lend to consumers or take security over consumer goods you must make your standard form contract terms and costs of borrowing for certain loans available publicly.

Repossession rules

There are rules lenders or repossession agents must follow when repossessing goods.

Self-reporting Guidance for Lenders

The Self-reporting Guidance for Lenders is intended to help lenders understand the process to follow when reporting potential breaches of the Credit Contracts and Consumer Finance Act 2003 and/or Fair Trading Act 1986 and the consideration that will be given to the self-report by the Commission.

Transfer of responsibility for regulation of consumer credit

Advertising

Annual Return

Assessing for affordability

Assessing for suitability

Buy Now Pay Later

Buy-back transactions

Changes to credit laws

Charging interest

Consumer credit fees

Consumer leases

Credit Pānui for Lenders

Disclosure obligations

Due diligence duties for directors and senior managers

Fit and Proper Person certification

Hardship applications

High cost loans

Lender responsibility principles

Lending online

Pawnbroking

Publication of contract and cost of borrowing

Repossession rules

Self-reporting Guidance for Lenders

Supporting customers in financial difficulty

Variations to consumer credit contracts

What is a consumer credit contract

When consumer credit law applies to your business