TasCOSS and many of our members are very concerned about the impact of predatory pay day lenders in Tasmania.
Alongside Anglicare, Neighbourhood Houses Tasmania, the NILS Network of Tasmania and the Hobart Community Legal Centre, we co-signed a letter on the issue that was sent to all 12 Tasmanian Senators and five Federal Tasmanian MPs.
In short, the letter supports legislation which the current Government has drafted but has not progressed further. We support the following reforms in the Bill:
- Limiting total small amount credit contract repayments to 10 percent of a person’s net
- income (known as a ‘protected earnings amount’);
- Capping the cost of consumer leases to the base price plus 4 percent of the base price
- per month for a maximum of 48 months; and
- Introducing a ‘protected earnings amount’ requirement for consumer lease providers that limits total consumer lease repayments to 10 percent of a person’s net income, equivalent but separate to the requirement for small amount credit contracts.
We believe that these measures will assist in protecting vulnerable Tasmanians. In effect, they ensure that lenders can only contract with borrowers who they believe are able to repay.
We’ll keep you updated on this important issue.