Now there are big changes coming for Buy Now Pay Later products, as the government moves to crack down on easy credit. It's looking at three options to regulate the industry and build in more consumer protection. Would you believe around 7 million Aussies have a Buy Now Pay Later account, which is 2 million more accounts than last financial year. So what's on the cards and what could it mean for users? Joining me now Assistant Treasurer Steve Jones. Minister, Buy Now Pay Later products are not new, they boomed. Why are there regulations now?
Explosion of users over the last few years, Kochie. We want to ensure that where these products are being offered, they're being offered safely to consumers and people aren't getting themselves into hot water. We have a template for regulating credit products. It's the National Consumer Credit Act. We're minded to bring Buy Now Pay Later inside the National Consumer Credit Act. But we want to consult with industry, with consumers to ensure that if that occurs, it occurs in the right way. I love the product. It's a great innovation. It's producing great competition for credit cards. But we want to ensure that innovation and that competition is happening in the right way.
Okay, why wouldn't you just bring it in anyhow? Because these things people have more than one account. There are no credit checks done on it. Some are opening fake accounts. Financial counselling services are saying they're predatory. Why not just go in and regulate it?
These are all the reasons that we do want to look at them, but we want to ensure that we're regulating to risk. And we're also mindful of the fact that for the majority of consumers, they're using this as an alternative to a credit card and they're doing so safely. We don't want to crash down on innovation. We don't want to stop people getting access to something that they're using properly and safely. But we do want to ensure that there is a basic level of check in place here that ensures that it's both affordable and appropriate to the consumers, which is the basic test inside the National Consumer Credit Act. The thing is, these aren't home loans, and that's an important distinction to make. These are generally small amounts of credit in the one and $200 level. So we want to ensure that if we are moving to regulate, it's appropriate to the level of risk involved.
Well, at least regulation that you've got to declare more than one account if you go to a different Buy Now Pay Later provider and for that provider at least to make some credit check. I know some of them do already, but not all of them.
Yeah, really uneven practice across the industry. The stuff you've just described sounds like straightforward common sense to me. A good way of ensuring people don't get in hot water and a crackdown on any predatory lending practices or sloppy lending practises, frankly. So that's the sort of thing that we're looking at. We've got a consultation paper out between now and the end of December. We'll look at it over Christmas, and if we're reform and legislative changes needed, sometime next year, mate.
Okay, excellent. All right. Keep us in the loop with that. Stephen Jones. Appreciate your time.
Good to be with you.