National Consumer Credit Protection Act 2009

CHAPTER 3 - RESPONSIBLE LENDING CONDUCT  

PART 3-2B - LICENSEES THAT ARE CREDIT PROVIDERS UNDER CREDIT CONTRACTS: ADDITIONAL RULES RELATING TO CREDIT CARD CONTRACTS  

Division 4 - Offers etc. to increase, and entitlement to reduce, credit limit of credit card contract  

SECTION 133BF   CREDIT PROVIDER NOT TO ENTER INTO CREDIT CARD CONTRACT UNLESS IT ALLOWS CREDIT LIMIT TO BE REDUCED  

Requirement

133BF(1)    

A licensee must not enter into, or offer to enter into, a credit card contract under which the licensee would be the credit provider, if the consumer who would be the debtor under the contract would not have a credit limit reduction entitlement under the contract.

Civil penalty: 5,000 penalty units.

Offence

133BF(2)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Meaning of credit limit reduction entitlement

133BF(3)    
A consumer who is the debtor under a credit card contract has a credit limit reduction entitlement under the contract if:

(a) for a contract that does not provide for a minimum credit limit - the consumer is entitled under the contract to reduce the credit limit of the contract to any amount (including nil); or

(b) for a contract that provides for a minimum credit limit - the consumer is entitled under the contract to reduce the credit limit of the contract to any amount that equals, or exceeds, the minimum credit limit.