Predatory lending will worsen if CDR expands, say consumer groups

Consumer advocates have warned Treasury’s push to expand the consumer data right (CDR) to non-bank lenders will not necessarily bring any benefits and may exacerbate predatory lending, in a submission responding to the federal government’s Open Finance plans.

In a joint submission released on Tuesday, the Financial Rights Legal Centre, Financial Counselling Australia and the Consumer Action Law Centre argue that because non bank lenders are not subject to the same regulations as the big banks are under the comprehensive credit reporting (CCR) mechanism, they could misuse the CDR data to target vulnerable customers.