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Introductions to the Privacy (Credit Reporting) Code 2024 (Credit Reporting Code) will set a new standard in the way Australians’ credit information is handled, in the hopes of boosting privacy.
Privacy Commissioner Carly Kind has welcomed the changes and noted the importance of keeping credit information secure.
“The credit reporting code sets out strict rules about how credit providers and credit reporting bodies must handle Australians’ credit information,” Kind said.
“Credit information can have a major impact on an individual’s life, such as affecting their ability to get a loan for a house or car. It is critical that credit information is handled with care and the right balance is struck between credit providers’ need to access credit information and making sure Australians’ privacy is protected.”
The protections that will come from the updated code, as listed by OAIC are:
- Improvements to explanatory materials to better explain how the credit rules apply to them
- Increased support for victims of fraud by ensuring a person can extend a ban on their credit report with minimal evidence
- A free alert system for victims of fraud who have placed a ban on their credit report, which will notify them if anyone tries to request credit during the ban period
- The ability to correct in one request, multiple pieces of incorrect information on an individual’s credit report caused by a fraud event
- The recognition of domestic abuse as a circumstance beyond an individual’s control that can lead to corrections needing to be made to their credit report
- Greater transparency over how credit reporting bodies and banks are complying with their privacy obligations
Meanwhile, benefits for industry include:
- Enhanced usability of the Credit Reporting Code and explanatory materials as they now mimic other legislative instruments
- Improvements to the explanatory statement, including provision-by-provision explanations, practical guidance, and examples to help industry understand and comply with its obligations
- Further information around the definition of a reporting ‘month’ to help industry comply and input information into their systems
- Changes to the ‘account close’ date definition to ensure consistency and certainty when industry is calculating this to report consumer credit liability information
- Transitional periods to enable time to update systems before compliance is required
“The enhancements provided by the new credit reporting code will help industry to meet their obligations and, in doing so, increase the trust and confidence of the Australian community in how their information is being used and disclosed,” said Kind.
“A well-functioning credit reporting system is fundamental to the Australian economy, especially as the credit landscape expands, and the new credit reporting code will help to support this.”
Changes to the code have been championed by Arca (previously the Australian Retail Credit Association). According to the organisation’s general manager Richard McMahon, the decision is a win for consumers.
“The updates provide consumers with more rights, promote consistent practices by credit providers and clarify the law for all parties. In short, they make credit reporting work better,” he said.
“The new process requires all parties to think carefully about the evidence they ask for to consider this kind of correction request. The process is intended to reduce the need for individuals affected by fraud to retell their story.”
Related: Credit reporting framework review underway
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