Assistant Treasurer Josh Frydenberg has set a hard task for the panel reviewing small amount credit contract laws, asking it to find the balance between enhancing consumer protection and ensuring that the extremely polarising payday lending industry remains viable.The review panel, which is chaired by Equipsuper chief executive Danielle Press, issued a consultation paper yesterday, calling for submissions.The panel has been asked to consider the effectiveness of the legislative provisions in the National Consumer Credit Protection Act that relate specifically to small amount credit contracts.These provisions include: A cap on fees and charges (a maximum 20 per cent establishment fee and a monthly fee of four per cent); A ban on credit contracts with terms of 15 days or less. A presumption that a loan is unsuitable if the borrower has held two other SACCs within the past 90 days. A requirement to obtain and consider an applicant's bank account statements for the preceding 90 days. A requirement to advise consumers of the alternatives to SACCs. A requirement that consumers who default must not be charged an amount that exceeds twice the amount of the loan. Special protection that applies to people who receive 50 per cent or more of their income from Centrelink.The panel will look at whether there should be any further regulation of the sector or change to current regulation, whether the current sanction regime is working and the extent of avoidance practices in the industry.It will look at whether there should be a national database of SACCs to assist providers in assessing applicants.Small amount credit contracts are loans up to A$2000 where the term is between 16 days and 12 months. Many of the borrowers who use them are excluded from other forms of personal finance and 25 per cent have income below the Henderson Poverty Line.In March the Australian Securities and Investments Commission released a review of the SACC market, saying that lenders were not following their own policies for protecting vulnerable consumers, were poor record keepers and were failing to meet their obligations in a number of areas.ASIC found that lenders had policies for dealing with applicants who were Centrelink clients but, in many instances, lenders were not complying with their own policies.It was the same story when it came to dealing with the presumption of unsuitability provisions. Lenders had policies in place but did not always follow them.ASIC said lenders were continuing to allow some consumers to use payday loans as part of their regular household budgeting. Some lenders appeared to be trying to avoid the cap on fees by changing loan terms so they fell outside the loan type covered by the provisions.The review panel will look at whether the provisions that apply to SACCs should be extended to comparable consumer leases.ASIC released a critical report on the consumer leasing market earlier this month, recommending that reforms "could be considered" to address conduct by lessors charging unreasonably high costs.The regulator said it had concerns about the misconduct