Target Market Determination

Purpose of this Document

The purpose of this Target Market Determination (“TMD”) is to comply with the Design and Distribution Obligations incorporated under Chapter 7 of the Corporations Act 2001 (“the Act”) by the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019.

The TMD aims to provide consumers and distributors with information about the class of consumers that comprises the target market for the Product, taking into account their objectives, financial situation and needs. It also specifies any Product distribution conditions and restrictions and deals with reviews of the TMD as well as distributor arrangements.

Legal Disclaimer

This document is not a credit disclosure document and does not include all relevant terms and conditions associated with this Product. It does not take into account any person’s individual objectives, financial situation or needs. Individuals interested in making use of this product should carefully read the Issuer’s Credit Guide and any other disclosure documents before making a decision whether to use this Product.

Description of Target Market

This section is required under section 994B(5)(b) of the Act.

Target Market Summary

This Product is likely to be appropriate for a consumer who is seeking an amount of credit up to $2,000 repayable over a period of 1 year, for the primary purpose of personal use.

The target market has been established by assessing the Product (including its key attributes) and the consumer objectives, financial situation and needs for which the Product is likely to be appropriate. The class of consumers who fall within the target market for the Product is described below, based on the objectives, financial situation and needs of the consumer and the key attributes of the Product.

Description of Consumer Objectives, Financial situation and Needs 

This Product is suitable for persons who:

• A consumer may have objectives both financial situation and needs, could require a personal loan of up to $2,000 repayable over a period of 1 year for a suitable purpose, is able to service the loan, establishment fee and monthly fees as they accrue.

Excluded Classes of Consumers

This Product is unsuitable for persons:

• Who do not qualify under the responsible lending requirements imposed by the National Consumer Credit Protection Act 2009 (“National Credit Act”), will be unable to comply with their financial obligations under the Product terms, or could only comply with substantial hardship.
• For whom the Product will not meet their requirements or needs.
• For consumers who receive more than 50% of their income from government benefits such as Centrelink and whose repayments will exceed 20% of their earnings.
• Include any disqualification that may indicate the Product is unlikely to meet the consumer class objectives, financial situation and needs

Description of Product and Key Attributes 

The key attributes of this Product are: 

• A list of key Product attributes and consumer eligibility requirements eg size and

      term of the loan, payment structure, fees and charges will vary as to the size of the loan required and therefore also will the repayment terms.

Product and Target Market Consistency

The Product, including its key attributes, is likely to be consistent with the likely objectives, financial situation and needs of consumers in the target market based on the following:

• The assessment that the Product, including its key attributes, is likely to be consistent with the likely objectives, financial situation and needs of consumers in the target market is based on an analysis of the attributes and characteristics of the product and establishing that they are consistent with the likely requirements of consumers in the target market.

Distribution Conditions and Restrictions

This section is required under s994B(5)(c).

Distribution Methods

This product is distributed through the following channels:

• Our list of the distribution channels used  are mostly face-to-face contact, some online and some possibly written requests.

Distribution Conditions

This product is distributed subject to the following conditions and requirements:

• The distribution conditions, targeted advertising, providing specific content about the Product on the Money Centre website, including lending guidelines, use of staff scripts specific to the Product to individuals that meet eligibility requirements, targeting individuals that have the appropriate borrowing capacity, and providing lending guidelines and training to external Factors Considered

In assessing the appropriateness of the distribution methods, conditions and restrictions, the Issuer has taken into account the following factors:

• The comparatively wide target market for the Product
• The Issuer’s ability to restrict distribution by providing sufficient lending guidelines and

      eligibility requirements

• The Issuer’s ability to manage the distribution channels
• The capability of existing distribution methods to reach the intended target market, based on

      past outcomes

Our prospective distribution methods include where Money Centre may consider previous instances where the product was issued through a specific distribution method as part of its assessment to determine the appropriateness of that distribution method 

Reviewing the TMD

The Issuer will review this TMD as follows:

Review Triggers

This part is required under section 994B(5)(d) of the Act.

If events or circumstances occur that would reasonably suggest that the TMD is no longer appropriate, the Issuer will review the TMD. This may include:

• an event or circumstance that would materially change a factor taken into account in making the target market determination for the Product a change in regulation, a substantial change in government benefits schemes rules resulting in reduced consumer income.
• a material change to the design or distribution of the Product
• a significant dealing in the Product that is not consistent with the product’s TMD
• the nature and extent of any feedback received from distributors or users of the product and significant changes in customer complaints, loan default rates.
• experiencing significant regulatory issues with industry bodies or government entities like ASIC investigations.

Mandatory Review Periods

This part is required under section 994B(5)(e) and (f) of the Act.

Initial Review: This TMD will be reviewed within 12 months of the TMD approved date. 

Periodic Reviews: This TMD will be reviewed at least every 2 years from the initial review date.

Distributors: Reporting & Required Information

This part is required under s994B(5)(g) & (h).

Complaints

Distributors are required to report and detail in writing all complaints in relation to the Product covered by this TMD to the Issuer every 12 months.

Significant Dealings

Distributors are required to report any significant dealing in the Product that is not consistent with this TMD, within 10 business days.

[Other information]

Appropriateness of the TMD

This section is required under s994B(5)(c) and s994B(8)(a) &(b).

The Issuer has reviewed the Product and its key attributes by considering its purpose, past outcomes and likely future outcomes, and has reasonably concluded that the Product is likely to be consistent with the likely objectives, financial situation and needs of consumers in the target market as described above, when offered to the consumer in accordance with the distribution conditions listed above. The comparatively wide target market of the Issuer has been a factor in assessing why the distribution conditions and restrictions will make it likely that consumers who purchase the product are in the class of consumers for which it has been designed.

Disclaimer: This suggested template should not be regarded as legal advice but rather as general guidance on the necessary inclusions on the Target Market Determination (TMD) required by the Design and Distribution obligations (incorporated under Ch 7 of the Corporations Act 2001 by the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Act 2019). Users should complete the document based on their own products, target market and distribution approach. It is recommended that users obtain financial and/or accounting advice as required.

© Francina Cantatore, Brisbane 2021.