NZBA back CCCFA fix for minor breaches
The banking industry has welcomed the first reading of the Credit Contracts and Consumer Finance Amendment Bill, which proposes more balanced treatment of minor disclosure breaches under the CCCFA between 2015 and 2019.
The bill responds to concerns raised in a Ministry of Business, Innovation and Employment (MBIE) regulatory review, which found the current law could impose disproportionate penalties for technical errors that caused little or no consumer harm.
Industry supports fairer treatment for past technical breaches
The bill aims to address inconsistencies in how historical breaches of disclosure rules are handled, particularly minor errors that currently risk triggering disproportionately large penalties.
“We believe the change proposed in the amendment bill is fair as it simply tidies up the existing legislation to ensure that all breaches from 2015 to 2019 are treated the same as those currently,” said New Zealand Banking Association (NZBA) chief executive Roger Beaumont (pictured).
“It is important to note that consumers will still be protected, and lenders will still be appropriately held to account once the law is amended.”
Amendment confirms court discretion remains intact
Beaumont emphasised that the proposed changes do not limit legal recourse but instead clarify that courts can determine appropriate outcomes for disclosure failures.
“The changes simply confirm that, if a lender fails to meet their disclosure obligations, the courts can decide what is a ‘just and equitable’ outcome for that failure,” he said. “That is no different to other civil and criminal cases and does not stop any current or potential future cases brought under this act. Consumers and regulators can continue to bring CCCFA claims before the courts.”
Calls for change span nearly a decade
NZBA, which recently highlighted the resilience of bank customers during ongoing economic pressures, has advocated for reform on this specific issue for years, citing the mismatch between minor administrative breaches and the scale of penalties.
“We have openly and transparently argued for changes to these particular disclosure provisions under this legislation for almost ten years,” Beaumont said. “And for good reason – the potential consequences are out of step with the potential harm.
“Currently any minor breach in a disclosure document, such as a wrong address, for the years 2015 to 2019 may require a full refund of interest and fees. That is not fair or proportionate compensation for customers who may not have suffered any material impact to their finances.”
Full support from New Zealand’s banking sector
The proposed changes have the unanimous backing of all members of the New Zealand Banking Association.
“All 17 members of the New Zealand Banking Association, including large banks and smaller New Zealand-owned banks, support these changes,” Beaumont said.
