ASIC is the Australian Securities and Investment Commission, an independent body that regulates Australia’s consumer credit and other financial service sectors. The Commission regulates not only the consumer lending sector, but also the corporate sector and other areas of the financial service industry.
Businesses obtain ABNs through ASIC, and the Commission regulates many of the activities of Australian business operators. The Commission is independent of the government with the commissioners appointed not by the government, but by the Governor-General. This is in line with other statutory bodies.
The Commission has a range of duties and roles in the consumer credit sector – the financial sector which encompasses personal loans for goods such as motorcycles. Regulating lenders as well as providing education for consumers via the very informative Moneysmart website.
Buyers seeking loans may be wondering, in its regulatory role, what effect will ASIC have on their motorcycle finance? We explain.
What is ASIC Impact on Bike Finance
ASIC is not a bank or lender. Buyers requiring finance do not contact the Commission to obtain a loan. The Commission does not provide credit or accept or review loan applications. The Commission’s role is to regulate the consumer lending sector by issuing Credit Provider Licences to companies that do provide finance. It also set the guidelines by which lenders – banks, finance companies and brokers, must operate in regard to loans for consumers. Consumer finance includes loans to individuals such as our Secured Motorbike Loan and Unsecured Personal Loans.
All providers of loans for motorbikes must be a Licensed Credit Provider with their licence number displayed. These licences are issued by the Commission. If offered credit say by a dealer or other non-bank company, ensure they have a credit provider licence. Licences can be checked on the ASIC website.
The Commission sets the requirements for consumer credit applications – the eligibility and the documentation required to apply for loans such as for a motorcycle. It also sets guidelines for lenders in approving loans. Specifically, that a lender must not offer credit to an individual that is deemed unsuitable for that person.
In addition to the guidelines and requirements set by ASIC, lenders will have their own criteria for certain loans and interest rates.
ASIC Motorbike Loan Requirements
When applying for a loan for a motorcycle and other goods, extensive detail and documentation is required to be provided. These criteria are included in the National Credit Code which falls under the National Credit Act.
Applicants must meet certain eligibility criteria. These are set by ASIC and include:- being over the age of 18 years; providing accepted forms of identification; having Australian citizenship or holding an acceptable visa; having residential address; and employment or source of income.
A range of documentation is required to verify the details. These include payslips, income tax returns, bank statements, identification such as passport, driver’s licence, Medicare card and similar.
When assessing applications, responsible lenders must abide by the guidelines which, as noted above, include not approving a loan which is not suitable for the applicant. If a person has a loan application rejected, it may be due to not meeting the requirements that the lender must follow.
While there may seem like a lot of documentation and detail to provide when applying for a loan, the ASIC rules and guidelines are in place to protect consumers.
What is ASIC Effect on Interest Rates
The Australian Securities and Investment Commission is not responsible for Australia’s official cash rate and the interest rates offered by lenders. The Reserve Bank sets the cash rate. Lenders set their rates for their different loans based on the cash rate, their funding costs and guidelines.
Rates offered to individual applicants will be determined by the lender’s assessment of the loan application and the review of the credit score and report.
The Commission may be seen to have an indirect effect on interest rate offers with the guidelines set for lenders to approve loans. Loan offers which are unsuitable to individuals must not be made. If a loan at a certain rate does result in payments which are not deemed workable for that applicant, the loan at that rate will not be approved.
What is ASIC Effect on Your Individual Loan?
Jade Bike Loans is a licensed credit provider, and we abide by the Responsible Credit Guidelines as set by ASIC. By using our broker services, applicants not only have their best interests addressed, but are provided with expert advice and guidance with their loan application.
Buyers can trust us to ensure that their finance is secured at the best possible rate and that all relevant rules and regulations have been met.
For details on what is ASIC impact on your motorbike loan, contact Jade Bike Loans on 1300 000 003.
DISCLAIMER: IN REGARD TO ANY ERRORS OR MISREPRESENTATIONS IN THIS MATERIAL, NO LIABILITY IS ACCEPTED. THE DETAILS, CONTENT AND DATA IS PRESENTED PURELY FOR GENERAL INFORMATIONAL PURPOSES FOR MOTORBIKE BUYERS AND THOSE SEEKING MOTORCYCLE LOANS. THIS IS NOT INTENDED AS THE SOLE SOURCE OF INFORMATION FOR FINANCIAL DECISIONS. IF SPECIFIC ADVICE IS REQUIRED AROUND FINANCIAL DECISIONS, READERS SHOULD SEEK THEIR OWN FINANCIAL ADVISOR.
