A payday lender that charged “amendment fees” for deferring repayments has been taken to court by ASIC, which alleges that it charged a prohibited fee.
Sunshine Loans, a provider of small amount credit contracts, received A$327,845 in amendment fees between 2016 and 2020.
Sunshine is an online lender offering short-term loans of up to $2000.
It charged the fee in circumstances where a consumer contacted Sunshine prior to a scheduled due date for a repayment and entered into an agreement to vary the credit contract by deferring repayment.
ASIC said in its notice of filing to the Federal Court that the amendment fee was not a fee or charge of the kind listed in the Credit Code.
The code lists fees that a provider of small amount credit contracts can charge. These include an establishment fee, a monthly fee, a default fee and a government fee.
ASIC is seeking a declaration that Sunshine Loans contravened the Credit Code in respect of 670,609 contracts. It is also seeking an injunction to stop the company committing further breaches.