Requirements to apply for a Credit Licence

Monday, 13 September 2010 12:09
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What does this option mean?

An Australian credit licence (ACL) authorises you and your representatives to engage in the credit activities that are specified on the licence. 

The Australian Securities and Investments Commission (ASIC) requires the ‘responsible managers’ of the business to met specific education and experience requirements in order to comply with the organisation competence requirements to hold a credit licence. If you cannot meet these requirements, it is unlikely that applying for your own licence will be something that you could consider in the first instance, however this may be something that you wish to pursue in the future.

General requirements you must meet to be approved for an ACL

There are a number of requirements that you must meet to be approved for a credit licence.  Broadly, they cover the following areas:

  • general conduct obligations
  • your broad compliance obligations
  • your internal systems
  • your people
  • your resources
  • dispute resolution
  • compensation arrangements

Next steps

To make registration easier, there are a few steps you can commence now.

  1. Think about the types of credit activities you will engage in as part of your business.
  2. Become a member of an ASIC-approved external dispute resolution (EDR) scheme.
  3. Complete background checks on your people.
  4. Update your details on other ASIC registers, as your details will be pre-filled in the online application form from these registers.
  5. Make sure all of the people who will need to make a declaration will be able to authorise the person submitting the application to make those declarations on their behalf.

Questions the registration application will ask include:

  • applicant, contact details and entity type
  • any identifying numbers, e.g. AFSL ABN, ACN or ARBN
  • current licences or registrations
  • principal address
  • details of EDR scheme membership
  • details of business activities
  • carried over instruments
  • business names
  • details of persons – statement about past conduct

ASIC have also released User guide form CS01 – Application for registration to engage in credit activities (PDF 6.26 MB) to assist people through the registration process.

To get a credit licence, you must complete an application (Form CL01 Application for an Australian credit licence), lodge it with ASIC and pay the application fee. To obtain a credit licence, requirements must be met:

a) being able to comply with the general conduct obligations of credit licensees under the National Credit Act, which aim to ensure that you operate your credit business properly; and

b) being a 'fit and proper' person to engage in credit activities

If you were not registered with ASIC by 1 July 2010, you must stop engaging in credit activities until you either become registered or have an Australian credit licence.

Last Updated on Tuesday, 17 December 2013 11:40
 

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