Consumer credit - maximum annual percentage rate

From 1 July 2010, credit will be regulated under the national Consumer Credit Protection Act 2009 (Commonwealth). New laws require all credit providers to be licensed and to belong to an external dispute resolution scheme approved by the Australian Securities and Investments Commission (ASIC).

New South Wales will continue to impose a maximum annual percentage rate on credit contracts in this state until 1 July 2011. From 1 July 2010, credit providers are required to include all credit fees and charges, including some third party charges, in the calculation of that rate. See Division 2 of Part 2 of Schedule 3 to the Credit (Commonwealth Powers) Act 2010 (NSW) for details.

The calculation of the maximum annual percentage rate for credit contracts entered into before 1 July 2010 will continue to be regulated by the Consumer Credit (NSW) Code, the Consumer Credit (NSW) Act 1995 and the Consumer Credit (NSW) Special Provisions Regulation 2007, while contracts entered into after 1 July 2010 will be regulated by Division 2 of Part 2 of Schedule 3 to the Credit (Commonwealth Powers) Act 2010. Some of the terms used in that Division take their meaning from definitions in the National Credit Code.