Proposed legislation that would stop car dealerships from offering finance without holding an Australian Credit Licence, could lead to consumers paying the price and could hurt smaller dealerships and those in regional areas.
While the MTA is still not sure what this policy will mean for the provision of finance at dealerships, most issues identified by the Banking Royal Commission in relation to dealership financing have already been addressed by responsible lending laws, changes to flex commissions and reductions in insurance commissions.
The majority of new car dealers, especially mid to small ones and those in regional areas, do not have credit licences. There will be a considerable cost of compliance for many businesses should this go through and the cost will almost certainly be passed onto consumers.
If you would like to comment on this issue, click here to contact the MTA’s Industry Engagement Specialist for our retail divisions, Nathan Groves.