National Consumer Credit Protection Act 2009

SCHEDULE 1 - NATIONAL CREDIT CODE  

Note:

See section 3 of the National Credit Act.

PART 2 - CREDIT CONTRACTS  

Division 5A - Additional rules relating to small amount credit contracts  

39A   Limit on the application of amount of credit provided under a small amount credit contract  

39A(1)    
No part of the amount of credit provided under a small amount credit contract may be applied to pay an amount (the prohibited credit amount ) to:

(a) the credit provider; or

(b) a person prescribed by the regulations.

39A(2)    
Subsection (1) does not apply to:

(a) an amount of a permitted establishment fee, or a permitted monthly fee, payable in relation to the small amount credit contract; or

(b) an amount of a government fee, charge or duty payable in relation to the small amount credit contract; or

(ba) if some or all of the amount of credit (the refinanced amount ) is to refinance some or all of the amount of credit provided by the credit provider to the debtor under another small amount credit contract - the refinanced amount; or

(c) an amount prescribed by the regulations.

39A(3)    
If subsection (1) is contravened in relation to a small amount credit contract:

(a) the debtor is not liable (and is taken never to have been liable) to repay the prohibited credit amount to the credit provider; and

(b) the debtor may recover as a debt due to the debtor any amount paid to the credit provider to the extent that it relates to the prohibited credit amount.