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Glossary

National Credit Code

The National Credit Code is part of the National Consumer Credit Protection Act and sets rules for regulated consumer credit contracts, including disclosure, hardship variations and enforcement procedures.

An example

A borrower with a regulated home loan experiencing hardship asks their lender for a variation. The Code sets out the process the lender must follow when considering the request.

Why it matters

Whether the Code applies affects disclosure, hardship options and what a lender must do before enforcing. Many private loans to companies or for investment are outside it.

Points to check

The Code applies to regulated consumer credit contracts, not to most business-purpose loans. If you are unsure whether your loan is covered, ask the lender how it classifies the loan and get advice. For regulated loans, the Code sets requirements for pre-contract disclosure, changes to the contract, hardship variations and default notices. ASIC's MoneySmart website explains the protections in plain language, and AFCA can consider complaints about member firms that do not follow them.

Related terms

Further reading: ASIC Moneysmart