Debt collectors in Australia: your rights under the ACCC and ASIC Debt collection guideline

Debt collectors in Australia must not harass, mislead or coerce you. The Debt collection guideline for collectors and creditors issued jointly by the ACCC and ASIC (current version issued 13 April 2021) explains how the Australian Consumer Law, the ASIC Act and the National Credit Code apply. It says collectors should generally contact you no more than 3 times a week or 10 times a month, only at reasonable times, and should stop contacting you at work or by a method you have reasonably asked them not to use. They must not threaten legal action they do not intend or are not entitled to take, misrepresent what you owe, or pursue a debt you have disputed without checking it. You can ask for communication in writing, dispute the debt, and complain to the collector, AFCA (if it is a member), ASIC or the ACCC.

This guide is part of debt help mistakes to avoid. It is general information only; the contact limits are guidance, so check the current guideline.

Who collects debts

Collector type	Examples	Main rules
Original creditor	Bank, lender, telco, energy retailer	Credit licence (for credit), consumer law, industry codes
Collection agency	Collects on behalf of the creditor for a fee	Consumer law; state licensing of collection agents in some states; often exempt from an ASIC credit licence when it only collects for a licensed credit provider
Debt buyer	Buys defaulted debts and collects in its own name	Same rules, and generally an ASIC credit licence for consumer credit debts; must be able to show it owns the debt
Law firm	Sends letters of demand, issues court proceedings	Legal profession rules as well

Debt buyers that take over consumer credit debts generally need an Australian credit licence, which brings AFCA membership. A collector that only demands and receives payments on behalf of a licensed credit provider can be exempt (National Consumer Credit Protection Regulations 2010 s 21), but the Debt collection guideline and consumer law still apply. Check the collector on ASIC's professional registers; if it is not listed, ask which licence or exemption it relies on.

Contact rules in the guideline

Topic	Guideline position (summary)
Frequency	Generally no more than 3 contacts a week or 10 a month, not counting contacts you start or agree to
Times — phone	Weekdays about 7.30am to 9pm, weekends about 9am to 9pm, in your time zone
Times — face to face	About 9am to 9pm; not on national public holidays
Workplace	Avoid contact at work if you ask, except where there is no other way
Third parties	Do not discuss your debt with family, employers or neighbours
Method	Respect reasonable requests to communicate in writing or through a representative
Representative	Deal with your financial counsellor or lawyer once told they act for you

These are summaries; the guideline sets out the details and exceptions. The guideline itself is not law, but conduct that breaches it can also breach the Australian Consumer Law or ASIC Act.

Prohibited conduct

Collectors must not:

use physical force, intimidation or undue harassment,
make false or misleading statements about the amount owed, the consequences of not paying, or their own authority,
threaten court action that is not intended, or say you will be arrested or jailed,
pretend to be a lawyer or government official,
add unauthorised fees,
contact you after you have said you are being represented, except through your representative,
demand payment of a debt that is extinguished or statute-barred while implying it can be enforced in court.

How to respond to a collector

Ask for details in writing: who owns the debt, the original creditor, the amount and how it is calculated, and the date of last payment.
Check the debt: is it yours, the amount right, and is it statute-barred?
Dispute it in writing if you disagree. The collector should stop collection until it has checked the debt and responded.
Make an offer only if the debt is valid and you can afford it; see negotiating a payment plan.
Ask for written confirmation of any agreement before paying.
Keep a log of every call, letter and message, with dates and times.

Worked example: counting contacts

Illustrative example: Hannah receives the following in one week from a collector: two calls on Monday, a text on Tuesday, a call on Wednesday evening at 9.40pm, and two calls on Friday. That is six contacts, double the guideline's weekly figure, and one call outside the suggested hours. Hannah writes to the collector asking for written contact only and listing the dates and times. If the contacts continue, she complains to the collector's dispute team, then to AFCA, and reports the conduct to ASIC.

If a collector says it will take you to court

A collector can start court proceedings on a valid, enforceable debt. If you receive a statement of claim or summons:

Do not ignore it. You usually have a short time to file a defence. If you do not, the creditor can get a default judgment.
Get advice from a community legal centre, Legal Aid or the National Debt Helpline.
A judgment can lead to enforcement, such as a garnishee order on wages or bank accounts, and a creditor owed at least $10,000 can use a judgment to issue a bankruptcy notice.
A court judgment stays on your credit report for 5 years.

Debt collectors and formal options

Once a debt agreement proposal is lodged, unsecured creditors generally cannot take recovery action during the voting period, and if the agreement is made they are bound by it.
Once you are bankrupt, unsecured creditors generally cannot pursue you for provable debts; refer them to your trustee.
Contact from collectors during either should stop for the covered debts. If it does not, tell the administrator or trustee.

Frequently asked questions

Can a debt collector take my belongings?

Not without a court judgment and an enforcement order. Only court officers such as sheriffs or bailiffs can seize property under a court order. A collector who suggests otherwise may be misleading you.

Can a collector tell my employer?

A collector should not disclose your debt to your employer. A garnishee order following a court judgment is different, because the court directs your employer to deduct from your wages.

What if the debt is not mine?

Tell the collector in writing, ask for evidence, and check your credit report for identity theft. Contact IDCARE if you think your identity was used.

Sources

ACCC — Debt collection guideline for collectors and creditors (2021)
ASIC — Regulatory Guide 96, professional registers
Australian Financial Complaints Authority — complaints about members who collect debts
National Debt Helpline — sample letters, free advice
IDCARE — identity theft support