Australian Credit Licence – Registration Assistance for Vendor Financiers

Hi Jason

If you register before 30 June, you can run your vendor finance business, in accordance with the new National Credit Code, up to 31 December 2010.  This effectively gives you from 1 July to 31 December to apply for your ACL.

If you do not register before 30 June you may not be in the business of providing credit or credit advice until you have your ACL.

If you do not register before 30 June and you wish to provide credit or credit advice thereafter, you may apply to an ACL holder (or a Registered entity, up to 31 December) to become their Representative.  This would allow you to operate as a ACL Representative until you get your own ACL.

Cheers,  Paul

Hi Andrew

To Register for the ACL and thereby be allowed to continue providing credit or credit advice until 31 December, you must Register with ASIC before close of business tomorrow (30 June).  The registration process requires you to join an External Dispute Resolution provider, e.g. the Credit Ombudsman Service Ltd and then go onto the ASIC website and complete the Registration form.  For a small vendor finance business it costs $495 ($165 joining fee & $330 for a portfolio of loans less than $1 million) to join COSL and nothing to Register on the ASIC site.

Applications for the ACL are available from 1 July 2010.  If you have run a vendor finance business for a minimum of 2 years you may not need any further qualifications until 2014, when you'll probably need a Certificate IV in Financial Services.  If you haven't got previous experience, you'll need to do the Cert IV qualification prior to completing your application.  Some training organisations can complete the Cert IV training course in 3 straight days.

If you are interested, have a look at:
http://www.asic.gov.au/credit

Cheers,  Paul

Hi Andrew

It's early days yet but the following should help:
1.  Become a Representative of an ACL holder
2.  Do a joint venture with an ACL holder

It is also important to remember that the new Act stipulates that you only need an ACL if you are "in the business of" providing credit or credit advice.  If you want to do one or two vendor finance transactions to sell off a couple of properties you own, you may not need the ACL.  However, the transaction will need to be setup and managed as per the new National Credit Code.

Please ensure you get independent legal advice concerning all the above.

Cheers, Paul