ASIC's Comprehensive Review Targets Motor Vehicle Finance Practices

Commencing in March 2025, the review will scrutinise the operations of seven lenders, with plans to extend the examination to brokers and other intermediaries as the project progresses. Key areas of focus include compliance with responsible lending obligations, management of loan defaults, hardship practices, and the effectiveness of dispute resolution processes.

ASIC has signalled its readiness to take enforcement action should any misconduct be identified during the review. The regulator emphasised that addressing issues in used car finance, especially those affecting vulnerable consumers, remains a top enforcement priority for 2025.

In line with this commitment, ASIC has already initiated legal proceedings against Money3 Loans Pty Ltd, alleging breaches of responsible lending obligations. Additionally, actions have been taken against car dealerships such as Diamond Wheels and Keo Automotive for allegedly providing unlicensed car loans with exorbitant interest rates.

The review aims to strengthen industry-wide compliance, improve consumer experiences, and mitigate potential harm to borrowers. ASIC plans to release initial findings in the latter half of 2025, followed by a comprehensive public report detailing the outcomes and any recommended actions.

For consumers, especially those in regional and remote areas, this review represents a significant step towards ensuring fair access to motor vehicle financing and protection against predatory lending practices. Borrowers are encouraged to stay informed about their rights and the evolving regulatory landscape to make well-informed financial decisions.