Do I Need a Credit Licence to Refer a Client for Finance?

Not always. ASIC recognises exemptions for certain referral activity, but they are conditional and narrower than giving credit advice. For consumer credit, recommending or assisting with a particular loan can require licensing or authorisation, while a properly structured simple referral may be exempt when the relevant conditions are met.

Quick answer: Not always. ASIC recognises exemptions for certain referral activity, but they are conditional and narrower than giving credit advice. For consumer credit, recommending or assisting with a particular loan can require licensing or authorisation, while a properly structured simple referral may be exempt when the relevant conditions are met.

The safe starting point is not "referrals never need a licence." The correct question is what exactly are you doing?

ASIC's basic rule

ASIC says anyone engaging in consumer-credit activity generally needs to hold a credit licence, be authorised, or fall within an exemption.

Credit activity includes suggesting or assisting a consumer in relation to a particular credit contract.

What can the upstream referral exemption cover?

ASIC RG 203 says a person relying on the upstream referral exemption must satisfy conditions including:

  • a written referral agreement with the licensee or representative;
  • making the referral incidentally to another business;
  • getting the consumer's consent before providing their name and contact details;
  • providing those details within five business days; and
  • disclosing any commission or other benefit.

It is a structured exemption, not a blanket permission to act like the broker.

What should the referrer avoid?

Do not assume the exemption lets an unlicensed referrer:

  • compare specific consumer loans;
  • recommend a particular lender or contract;
  • tell the client which regulated credit contract they should choose;
  • assist with the application in a way that amounts to regulated credit assistance.

What about business finance?

The National Credit Act focuses on consumer credit. A business-purpose transaction may fall outside that consumer-credit regime, but purpose and facts matter. The partner arrangement can still set clear boundaries so the referrer does not need to decide the legal classification on the fly.

GPS Finance can keep the professional's role limited to the introduction and take over the finance discussion from there.

Thinking about adding finance referrals to your practice? GPS Finance works with professional referrers across consumer, vehicle, asset, business and commercial finance. Partner remuneration can be available on eligible settled referrals under an agreed arrangement; the structure varies by product and relationship. [See how the GPS Finance partner model works](https://gpsfinance.com.au/partners?content_origin=do-i-need-credit-licence-refer-client-finance&partner_type=professional&promo=partner_article_cta).

Related referral guides

Sources and verification

KK Neelamraju — Founder, GPS Finance Group

KK is a finance and credit professional with more than 20 years of lending and credit experience.

General information only. Referral, licensing, professional-conduct, tax and disclosure obligations depend on the activity, profession, client and arrangement. This is not legal, tax or accounting advice. Check the requirements that apply to your practice before relying on a referral exemption or accepting remuneration.

Need help matching this to a business-finance option?

GPS Finance can review the funding purpose, conduct, documents and lender fit before you make a formal enquiry.

Request business finance optionsAsk a question

← Previous post Next post →