Rent the Roo was recently fined $27,500 after the Australian Securities and Investments Commission (ASIC) issued it with an infringement notice for a breach of the responsible lending laws under the National Consumer Credit Protection Act 2009 (National Credit Act). ASIC also entered into an enforceable undertaking with the national rental goods provider after surveillance found deficiencies in its operating and compliance practices. Rent the Roo joins an ever-growing list of rental good companies paying the price for questionable credit practices.
In a recent press release ASIC stated that they are particularly concerned because Rent the Roo regularly deals with consumers who receive social security or government benefits as their only source of income, including Indigenous consumers living in remote locations who have limited access or exposure to other mainstream retail and/or credit services and whose first language may not be English.
Financial Counsellors at the Indigenous Consumer Assistance Network Ltd (ICAN) witness the devastating consequences of financial over commitment on a daily basis. ICAN Financial Counsellor, Unaise Buli said, “rental goods companies need to stop taking advantage of the poor financial literacy of some Indigenous consumers and need to make sure that people can actually afford what they’re signing up for.”
ASIC’s crackdown on responsible lending and credit laws has seen action taken against firms that failed to observe their obligations, including Mr Rental, Mobile Rentals, Zaam Rentals, Ray Rentals and Channic & Cash Brokers. ASIC Deputy Chairman Peter Kell said, ‘Credit licensees have an obligation to ensure their representatives adhere to their license requirements, especially when dealing with vulnerable consumers.’
ICAN CEO, Aaron Davis is deeply concerned about the impact of the rental goods industry on Indigenous consumers and welcomes ASIC’s continued action in these matters. “ICAN along with North Queensland Indigenous Consumer Taskforce partners the Australian Securities and Investments Commission, Australian Competition and Consumer Commission and Queensland Office of Fair Trading will continue to monitor the rental goods industry in the region.”