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Younger Australians are facing a credit crackdown as the government prepares to issue tougher regulations and rules on the buy-now, pay-later industry.
New users will face the need for a credit check and the need to prove their income.
“I think this is an important part of consumer protection,” said Assistant Treasurer Stephen Jones.
Millennial and Gen Z Australians are likely to be disproportionately affected as they make up the majority of buy-now, pay-later customers.
Jones told the Herald that millennials are more likely to buy a now, pay later bill than a credit card.
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The bill will reportedly be tabled in parliament today.
It will require providers to have an Australian credit licence, be members of the Australian Financial Complaints Authority and have effective dispute resolution processes.
They will also need to check the financial status of new customers to make sure their credit is suitable.
Providers will also not be able to increase credit limits without the customer’s consent.
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