media release (21-094MR)

Firms offering debt management services require credit licence to operate


ASIC has today released an information sheet for providers of debt management services that explains their new regulatory obligations, including the requirement to be licensed.

The National Consumer Credit Protection Amendment (Debt Management Services) Regulations 2021 (Regulations), made on 29 April 2021, prescribe certain debt management services as a ‘credit activity’ for the purposes of the National Consumer Credit Protection Act 2009 (National Credit Act).

Under the Regulations, a ‘debt management service’ broadly covers services such as ‘credit repair’ and ‘debt negotiation’ that are carried out in relation to a consumer credit contract and where a consumer is required to pay.

From 1 July 2021, subject to transitional arrangements, providers of debt management services must hold a credit licence with an authorisation that covers debt management services. The transitional arrangements allow for the continued provision of debt management services while a provider is actively taking steps to be covered by a credit licence. Specifically, under the transitional arrangements, if you intend to provide debt management services from 1 July 2021, you will need to, by 30 June 2021:

  • have applied for, and have ASIC accept for lodgement, a credit licence application or variation that covers this activity (or have arrangements to act as a representative of a provider that has applied for a licence to cover this activity), and
  • be a member of the Australian Financial Complaints Authority (AFCA).

To assist providers of debt management services understand these changes and the steps they need to take to be covered by a credit licence with a relevant authorisation, ASIC’s information sheet explains:

  • what is a debt management service
  • the transitional arrangements set out in the Regulations
  • how to apply for a credit licence (or variation) with a debt management authorisation, and
  • the conduct obligations that must be met by licensees.

If you are a firm or individual that provides debt management services and you wish to continue to provide these services from 1 July 2021, you will need to take steps as soon as possible to ensure that you have lodged a complete licence application so that you will be able to rely on the transitional arrangements allowed for in the Regulations. It is important to be aware of the following:

  • some information that needs to be included with the application – such as criminal history checks – can take time to obtain, and your application risks not being accepted for lodgement if it does not include all the required information, and
  • if your application is not accepted for lodgement by ASIC (because it is incomplete), you will not have the benefit of the transitional arrangements unless you submit a further and complete application before 1 July 2021.

If you lodge your application after 1 June 2021, you risk losing the benefit of the transitional arrangements, if the application is not complete and ASIC does not accept it for lodgement by 30 June 2021. This may occur if you lodge an incomplete application and are not able to provide a complete application by 30 June 2021.

If you do not comply with the requirements of the transitional arrangements and continue to provide debt management services from 1 July 2021, you will likely be engaging in credit activities while unlicensed. This is an offence under section 29 of the National Credit Act.


Debt management services were previously not regulated under the National Credit Act. On 25 September 2020, the Government announced a package of reforms to Australia’s consumer credit laws. This announcement included a statement that debt management firms will be required to hold a credit licence. The making of the Regulations gives effect to this announcement.

More information about the changes


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