Removing the laws could also reduce the ability of advocates – including a community lawyer – to assist survivors with debts that have accrued during abusive relationships. 

Chief executive of Financial Rights Legal Centre, Karen Cox, said the current lending obligations prescribe important steps that often identify “red flags” in domestic and family abuse. She said it’s an “important” step in identifying and preventing any further violence. 

“These critical protections serve a vital purpose – requiring the lender to make inquiries as to the loan’s purpose, stability and affordability,” Ms Cox explained, adding that the laws require all lenders to undertake an assessment process that will often have them put on notice when loans have been identified as unapproved.

Laura Bianchi, Redfern Legal Centre’s Financial Abuse Service NSW team leader and coordinator of Economic Abuse Reference Group NSW, said its members have grave concerns about the impact of removing lending protections for victim-survivors. 

“The wind back of responsible lending obligations will have dire consequences for the people experiencing financial abuse. Coerced debt is a common factor preventing the victim-survivors from leaving a violent relationship and re-establishing their lives,” she said.

VIEW ALL

Ms Bianchi said the escalating rates of family violence and economic abuse during the COVID-19 pandemic have been “well documented”.

“Removing the critical protections at a time when so many women are more vulnerable than ever to economic abuse could have devastating results,” Ms Bianchi said.