On 20 October 2025, the Finance and Expenditure Committee (FEC) published its reports on the Credit Contracts and Consumer Finance Amendment Bill and the Financial Service Provider (Registration and Dispute Resolution) Amendment Bill which make up two of the three bills key to the Government's financial services reform plans. The FEC report for the third financial services reform bill, the Financial Markets Conduct Amendment Bill, has received an extension and is now due on 30 January 2026.
Over five months, the Committee received almost 1,700 submissions across the two bills and heard from 48 submitters at the hearings. Below, we summarise the key changes recommended by the FEC for the amendment bills published this week. For further background of the reform and the proposed amendments please see our previous articles: Government announces decisions on financial services reform and Amendments to support the next phase of financial services reform introduced to Parliament.
Credit Contracts and Consumer Finance Amendment Bill (CCCF Amendment Bill)
- Much attention has been given to the application of the retrospective provisions, particularly as they apply to claims filed from 2015 to 2019 which has a direct effect on current and ongoing litigation. The controversy of this is evident as for every submission in support of these provisions, the FEC received over 100 in opposition. The FEC has recommended explicitly excluding the existing class actions from the effects of the retrospective provisions. In all other relevant historical issues, the courts would be able to determine the "just and equitable" amount that should be awarded to affected borrowers.
- The bill, as introduced, includes new sections 94AA-94AC which, upon application of an individual or the FMA, would allow a court to make an order that a borrower is not liable for all or part of their costs of borrowing. As currently drafted, a court is required to consider three requirements before giving such an order. The FEC recommends removing new section 94AA(2)(b) as section 93AA(2)(a) already requires a court to consider whether the order is broadly "just and equitable". It considers that the need to require a court to consider whether any other order sufficiently provides a just and equitable remedy for the breach should not be needed, and keeping section 94AA(2)(b) may instead pose as a barrier to borrowers or the FMA from accessing this remedy.
- One of the major changes of the CCCF Amendment Bill is the transfer of regulatory responsibility from the Commerce Commission to the Financial Markets Authority (FMA). One of the FMA's proposed powers in the Credit Contracts and Consumer Finance Act 2003 (CCCFA) is to make certain declarations. The FEC suggests further aligning this power with its power to make interim orders in the Financial Markets Conduct Act 2013 by adding a new section with similar constraints. The FEC also suggests adding an offence clause for a failure to comply with such interim order made under new section 138CA.
- The FEC has recommended that the requirement to hold a market service licence should only be required of mobile traders involved in lending or credit sales. Businesses that supply goods and provide credit contracts as separate entities would previously have been required to hold separate market licences. The amendment would exclude the former (entities that only supply the consumer goods) from requiring a market licence. Given that the protections of the CCCFA would not extend to such entities, requiring them to be licensed and supervised was considered inappropriate.
Financial Service Provider (Registration and Dispute Resolution) Amendment Bill (FSP Amendment Bill)
- New section 79(1)(caa) enables the Governor-General, on the recommendation of the Minister, to set regulations to ensure the independent governance of the approved dispute resolution schemes (DRS). These regulations are to be made for the purpose of prescribing certain requirements for the membership of a DRS board, for example, skills, experience and disqualifying grounds. Regarding these regulations, the FEC recommends further amending new section 79(1)(caa)(iii). Where such regulation requires the board to be "reasonably independent of any financial service provider", it is to be made clear that this relates to the board's overall independence only. The FEC confirmed that the intention here is not to exclude any industry representatives on the boards of DRS.
- The FEC acknowledged the significant support for a single DRS, however this is outside the policy intent of the current bill, and it would not propose consolidating the four approved DRS. It noted submissions arguing that consolidation could weaken consumer awareness and trust, and diminish the specialist expertise of each scheme, although a single DRS could potentially improve fairness, transparency and efficiency, and align with international best practice. The Minister is encouraged to make further enquiries while the FEC monitors the legislation and any policy work relating to the consolidation of the DRS in 12 months' time.
Next steps
It is unclear how quickly these bills will progress through the rest of the House. The Minister of Commerce and Consumer Affairs had previously indicated that the bills would be enacted by the end of October 2025. This now is looking unlikely, particularly following the extension given to the Financial Markets Conduct Amendment Bill.
We will continue to keep you updated with the release of the Financial Markets Conduct Amendment Bill's select committee report, and as the bills head to their second readings and beyond.
Co-authored by Laura Sahng (solicitor).
