Financial Counselling Australia surveyed financial counsellors across Australia to gauge their reactions to the proposed scrapping of responsible lending laws. The survey provides important insights into why financial counsellors think the laws are important, how many use the laws to help clients and what they predict will happen if the laws are removed.

The findings from the survey will be used by FCA to inform the community, politicians and the media about why these laws should remain and what may happen if the Federal Government’s planned changes go ahead.


What did FCA find?

Finding 1: Financial counsellors think that responsible lending laws should stay.

Almost all of the financial counsellors surveyed (97%) think that responsible lending laws should remain.

Finding 2: Financial counsellors believe the laws protect consumers.

Almost all of the financial counsellors surveyed (94%) either strongly agreed (87%) or agreed (7%) that the responsible lending laws are an important consumer protection.

Finding 3: Financial counsellors use the laws to help their clients.

Almost all of the financial counsellors surveyed (93%) use the responsible lending laws in advocating for clients (78% strongly agreed and 15% agreed).

Finding 4: Financial counsellors predict they will see more clients with unaffordable debt if the laws are scrapped.

Almost all financial counsellors agreed (92%) that if the laws are repealed, financial counsellors can expect to see many more clients with unaffordable debt (82% strongly agreed and 10% agreed).

Finding 5: Financial counsellors believe scrapping the laws will hinder the economic recovery from COVID-19.

The majority of financial counsellors (71%) agreed that if the laws are repealed, this will hinder the economic recovery from the pandemic (52% strongly agreed and 19% agreed).

Finding 6: Financial counsellors are very concerned about the impact of repealing the responsible lending laws on their clients and the community. They believe such a move will be harmful to individuals, families and the public (see Appendix A for complete list).


Qualitative comments from financial counsellors reflect expectations of the following themes if responsible lending laws are repealed:

  • Unaffordable and increasing debt
  • More bankruptcies
  • More people forced into homelessness and poverty
  • More mental health issues and suicides
  • Adverse impacts on vulnerable people
  • Reduced protection from predatory lending
  • Increased workload on financial counsellors

Finding 7: Even with the laws, financial counsellors are helping clients with some very concerning cases of irresponsible lending.

More than three quarters of financial counsellors provided examples recounting some of the worst cases they have come across (see Appendix B for compete list).



The results show an overwhelming majority of the financial counsellors surveyed think that responsible lending laws should remain in place. The laws, set out in the National Consumer Credit Protection Act 2009, are seen as a vital protection for clients and an invaluable tool for financial counsellors.

A key underlying theme in the qualitative remarks left by financial counsellors was the devastating impact on people who are victims of irresponsible lending. Unaffordable debt is overwhelming and affects the mental and physical health of those involved. A number of financial counsellors said suicide was a real risk for people affected. Relationship and family break ups are also a key concern. Increased bankruptcies, loss of housing, poverty and a higher demand for emergency relief were all listed as likely impacts.

182 of the respondents provided current and recent examples of irresponsible lending. Many of these examples involve vulnerable people. People with disabilities, the elderly, immigrants, Indigenous Australians, people with addictions, people  who speak little or no English, single parents, Centrelink recipients and survivors of

family violence and financial abuse are already exposed to unsafe lending practices.

Under current laws, financial counsellors are able to seek redress and help for their clients who experience irresponsible lending. If the laws are axed, financial counsellors will find it much harder to assist, leaving some of the most vulnerable members of society with debts they will struggle to repay.

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