Government sneaks in draft legislation to regulate small businesses access to credit

With attention focused on the abandoned budget surplus, the Federal Government has published draft legislation which proposes regulating small business credit in a move critics say will make it harder for small business to get funding.

At the moment, small business credit is not regulated. However, draft legislation from Financial Services Minister Bill Shorten’s office proposes prohibiting people from “engaging in credit activities” in relation to a small business credit contract or a small business consumer lease unless they hold a permit.

A spokesperson for Shorten said that the reforms proposed include prohibiting people from “engaging in credit activities” in relation to an investment credit contract unless they hold an Australian credit licence.

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