The study – Dispute Resolution for Credit Consumers – calls for consideration of additional regulation, both for the credit industry’s internal handling of complaints and for external dispute resolution. Consideration should also be given to industry-based external dispute resolution schemes.
The report was prepared by a team headed by La Trobe University Law Professor, Tania Sourdin, a specialist in alternative dispute resolution. It was launched today, Friday, 23 March 2007 by the Minister for Consumer Affairs, Daniel Andrews.
Apart from speeding up and streamlining current processes, the report also suggests re-establishing the consumer credit ‘hotline’ for debt counselling and advice about disputes – and the funding of legal aid representation through VCAT – the Victorian Civil and Administrative Tribunal.
Professor Sourdin said the study analysed the effectiveness, accessibility and the procedural fairness of dispute resolution processes offered through VCAT and Consumer Affairs Victoria (CAV). It was designed to assist policy makers, the Department of Justice CAV, VCAT and credit consumers to ensure processes function as effectively as possible.
The La Trobe study reviewed VCAT and CAV credit dispute files and surveyed consumers for their impressions about matters such as fairness of process and outcome, timeliness, accessibility, cost and effectiveness. It said user satisfaction was a criterion in determining whether or not a process is effective.
VCAT was generally perceived as fair. Outcomes met expectations: 60pc of the sample was ‘very’ or ‘fairly’ satisfied. Of the 40 pc who were dissatisfied, 30 pc were ‘very dissatisfied’. Some consumers considered it an impersonal environment and said at times its processes were confusing.
CAV was mostly perceived as friendly and helpful. For example, the majority of the interviewees felt that CAV got at the facts (77.6 percent), was impartial (83.7 percent), and produced a fair outcome (73.2 percent).
The report also considers benchmarks for dispute resolution and complaints handling, and makes recommendations based on best practice standards.
It concludes that additional research is needed into credit disputes involving ‘vulnerable consumers in vulnerable regions’. The way in which consumer credit matters are handled in Magistrate courts also needs further examination.
Friday, 23 March 2007 Report into credit disputes calls for better education, regulation and supportA La Trobe University study recommends education campaigns targeted at credit providers to help them handle complaints – and at vulnerable consumers to increase their awareness of services that can assist with credit problems.