ASIC registers: how to check a licence

Why the registers matter

The Australian Securities and Investments Commission keeps public registers that anyone can search. For property borrowers, they answer three simple questions: does this business exist, is it authorised for what it is doing, and has anyone involved been banned? Answering those questions takes a few minutes and costs nothing, yet it is one of the most effective protections against impersonation scams and against dealing with a business that is operating outside its authority.

The registers are found through ASIC's search page at asic.gov.au. Moneysmart also has a simpler search tool for licensed financial firms at moneysmart.gov.au. Our step-by-step guide on how to check a lender puts these searches in the wider context of checking a deal.

The registers you are most likely to use

Credit licensees and credit representatives

An Australian Credit Licence allows a business to engage in credit activities covered by the National Consumer Credit Protection Act 2009, such as providing regulated loans or broking them. A credit representative is a person or company authorised by a licensee to act on its behalf. The register shows the licensee's name, its licence number, the status of the licence and the activities it is authorised to carry on.

When you look up a credit representative, the record shows which licensee authorised them. That matters because the licensee is responsible for the representative's conduct. If something goes wrong, the licensee is usually the party a complaint is directed to.

Financial services licensees and authorised representatives

An Australian Financial Services Licence is a different authority. It covers dealing in financial products, operating managed investment schemes and giving financial product advice. Many private credit managers hold one because they operate funds that take investors' money. If a lender tells you its loans are funded by a fund it manages, it is reasonable to check that the manager holds a financial services licence and that the fund is described in its documents.

Banned and disqualified persons

ASIC keeps a register of people and organisations that have been banned from providing credit or financial services, or disqualified from managing companies. Search the names of the individuals you are dealing with, not only the business. A person can be banned even if their new company looks new and clean.

Companies and business names

The company register confirms that a company exists, shows its registration status and lists its registered office. The business names register links trading names to the entities that hold them. Together, they let you confirm that the name on a term sheet belongs to the company that will actually lend. Our glossary entry on the Australian Credit Licence explains the licence types in more detail.

A simple order to search in

1. Collect the legal name, ABN, ACN and any licence or representative number from the documents you have.
2. Search the professional registers by number. Note the name, status and authorised activities.
3. Search again by name. Make sure the name returns the same record and that there is no similar-looking entity you may be confusing it with.
4. Search the company register and the Australian Business Register to confirm the entity is active and its ABN matches.
5. Search the banned and disqualified register for every individual named in the deal.
6. Check membership of the Australian Financial Complaints Authority, and read our guide to AFCA complaints for borrowers.
7. Contact the business on a phone number you found yourself on its official website.

Reading the results carefully

Status. A licence can be current, suspended, cancelled or surrendered. Only a current licence authorises activity.

Authorisations. A licence that allows a business to act as a broker does not allow it to act as the lender. If the business tells you it is lending its own money, check that the licence covers that, or ask why it is not needed.

Addresses. Compare the principal business address with what you were told. A mismatch is not proof of wrongdoing, but it is a reason to ask questions.

Dates. Very recent registration is common for legitimate new businesses, but combined with pressure to sign quickly or pay fees upfront, it should make you more cautious. The warning signs are listed in scams and red flags.

When a licence is not required

Credit provided wholly or predominantly for business or investment purposes is generally outside the National Credit Code. A lender that makes only those loans may not need an Australian Credit Licence at all. That is lawful, but it means the statutory responsible lending obligations do not apply to your loan, and your options if something goes wrong may be narrower. Ask the lender which rules apply and confirm with your lawyer.

Many business-purpose lenders still hold a licence, belong to AFCA voluntarily or operate funds that require a financial services licence. Those features do not make a loan cheaper or safer on their own, but they do tell you more about who you are dealing with and where you can complain.

What the registers cannot tell you

A clean register search shows that a business exists and is authorised. It does not show that a loan is fair, affordable or appropriate for you. It does not check the lender's funding, its track record or how it treats borrowers in default. For those questions you need your own lawyer and accountant, careful reading of the documents and, where possible, conversations with other people who have dealt with the lender.

For a loan with significant fees or default terms, read our guide to term sheet fees and default clauses. For the regulatory background on why banks and private lenders behave differently, see APRA rules and bank lending limits.

Reporting a concern

If a register search shows something does not add up, stop and do not send money. You can report suspected scams to Scamwatch and report misconduct to ASIC through its online form. If you have already paid, contact your bank immediately. Our lesson on choosing a professional explains how to find a lawyer or accountant to help review a deal.

Keeping a record

Take a screenshot or save a copy of each register result with the date you searched. Registers change, and if a dispute arises later, a dated record of what the register showed at the time can be useful to your lawyer, to AFCA or to a court. Keep these records with the term sheet, letters of offer and emails about the loan.

A worked example

Imagine a borrower, Sam, who receives a term sheet by email from a business calling itself a private lender. The email signature quotes a credit licence number and an ABN. Sam searches the licence number on ASIC's professional registers and finds a current licence, but under a slightly different company name. Searching the ABN on the Australian Business Register shows a third name. Rather than assuming a clerical error, Sam finds the licensee's phone number on its official website and calls. The licensee says it has never heard of the person who sent the email. Sam stops, keeps the email and reports it to Scamwatch. A few minutes of searching avoided a costly mistake.

Further reading

• How to check a lender
• Private credit explained
• Private lending overview
• Australia's private credit market