Proposed Privacy Act changes may give greater bank investigate power
20 October 2009
New proposed changes to the powers allowed to be used by Australian bank industry have come under scrutiny as the question of the level of privacy should be allowed to potential bank customers. The new proposed changes for the Privacy Act are offered up as part of the new legislation by Chris Bowen, Financial Services and Superannuation Minister.
Under the proposed Privacy Act a bank would now be able to have access to the financial records of an individual that are currently deemed off limits, such as any competitor bank accounts, utility bills, any previous accounts and their credit history, including their repayment records.
As it stands now, these records are only made when a borrower misses a repayment by between 60 or 90 days after the due date, whereas the new regulations could see a late payment recorded if only even one day late.
The new proposed laws have governmental support with those in favour saying that these new laws would give a bank greater insight into a person's financial history and situation when considering them for any new accounts, in particular, new credit cards and determine whether or not they are able to take on a potential new debt.
Prompting this is the new responsible lending requirements that will hold a bank responsible for who they now give their credit cards too. The new requirements are expected to force a bank to decide before granting a new credit card whether or not the individual can afford the repayments.
Russell Evans of credit information agency Veda Advantage stated that all discussions about this proposed law have been focused on the payment cycle of bill repayments, meaning that if a person missed a bill payment or credit card repayment, whether or not by the next billing time they would have an official missed payment lodged.
"The proposals would allow somebody who has been through a difficult financial period to demonstrate that they have recovered by meeting all of their repayments in a timely fashion,
"This would protect families from taking on more debt at a time when they need assistance to help them out of debt." Mr Evans said.
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