Credit fees and charges: Unreasonable fees
View whole document on one page
View the whole document as a PDF
| Q.6 Do you think the provision of fee guidelines will provide sufficient advice for industry to develop their fee structures? Does there need to be more regulation or prescriptive guidelines for fees; if yes, in what areas? |
Generally consumer representatives supported the introduction of guidelines on the basis that fees would presumably be less expensive.
The banking industry signalled a strong reluctance for prescriptive guidelines within the CCCFA. The preference is the Act remain principled and flexible. The Commerce Commission's fee guidelines were welcomed but there was wariness that they will become de facto regulation (the fee guidelines are current in draft form).
Lenders outside the banking industry were more mixed in their responses. On one hand, there were those generally supportive of the Commerce Commission's proposed guidelines and, on the other hand, there were those critical of their use, suggesting guidelines are open to interpretation.
Individuals and groups representing lenders suggested the Commerce Commission's guidelines showed an anti-business bias. It was also suggested that a prescriptive approach to fees would result in some lenders setting fees at the maximum which would not reflect the true cost of the fee to the lender.
It is clear that submitters from across the industry are keenly awaiting the publication of the Commerce Commission's fee guidelines.
Generally there is a preference for the Act to be principle based, with the Commerce Commission's guidelines expected to be useful. However, some submitters would additionally like to see more enforcement in this area from the Commerce Commission as this in itself would provide more transparency.
