The self-managed super funds lobby is fighting a proposal by David Murray's Financial System Inquiry to prohibit borrowing by super funds with new guidelines that most lenders are yet to endorse.In response to evidence that "suggests that borrowing in superannuation is often associated with poor financial advice" the FSI's Interim Report floats the option of restoring "the general prohibition on direct leverage of superannuation funds on a prospective basis."The Self Managed Superannuation Fund Professionals Association of Australia has issued a new set of guidelines for lenders that, so far, only National Australia Bank has signed up for.The SPAA's Limited Recourse Borrowing Arrangement Lenders Best Practice Guidelines ask the lender to seek acknowledgement from the SMSF trustees that they have been recommended to get financial, legal and specialist SMSF advice. There is also a separate set of guidelines for advisers. SPAA's chief executive Andrea Slattery said on 29 July that other major lenders were "in the pipeline" of signing up. Yesterday the SPAA could not update that information.The SPAA was conscious of a tiny rogue minority of spruikers and of the concerns raised by the Financial System Inquiry, said Slattery.The FSI observed that: "If allowed to continue, growth in direct leverage by superannuation funds, although embryonic, may create vulnerabilities for the superannuation and financial systems."That observation was disputed in the SPAA's second round submission to the FSI:"We do not believe that direct gearing through the use of LRBAs is occurring in an excessively risky manner ... defaults on those mortgages are lower than traditional consumer lending," its submission said."SPAA's discussions with major lenders show the majority of loans made to SMSFs are being made with responsible lending practices."The average limited recourse loan to a self-managed super fund was A$311,000 in November 2013, and was used to purchase a property with an average value of $450,000, according to the SPAA.The Financial System Inquiry's interim report had a higher estimate of average borrowings - $357,000 in 2012, up from $122,000 in 2008 - while 3.7 per cent of SMSFs had loans in 2012 (1.1 per cent in 2008).