Sunshine Loans

Target Market Determination for Small Amount Credit Contracts

This Target Market Determination (TMD) has been prepared by Sunshine Loans Pty Ltd ACN 092 821 960 (Us, We, Our) Australian Credit Licence 390995 in compliance with our Design and Distribution Obligations under Part 7.8A of the Corporations Act 2001 (DDOs). It applies to our Small Amount Credit Contract (SACC) product.

1. The Target Market for Our SACC Product

The Target Market our SACC product is consumers who:

  • need amounts of between $150 and $2000;
  • need to pay for infrequent and sometimes unforeseeable expenses that cannot be met from their regular or usual disposable income but not for paying regular, ongoing ordinary household expenses such as utilities unless it is to pay accumulated arrears or unusually high amounts due to special circumstances;
  • have not taken more than 5 SACC loans from us in the previous 12 months;
  • are not interested in long loan terms;
  • do not need the loan to pay any other consumer credit debt;
  • can afford the repayments on the product without hardship;
  • have a net income greater than $400 per week;
  • want contracts which are clear and easy to understand;
  • want easy access to customer services to discuss payments, hardship and terms of the contract;
  • want the funds quickly;
  • want the loan application process to be simple, online, and quick.

2. The Key attributes of Our SACC Product

The key attributes of our SACC product are:

  • Loan amounts from $150 to $2000.
  • Terms from 9 to 16 weeks.
  • Fixed credit charges - Establishment fee of 20% of the Amount Financed and Monthly fee of 4% of the Amount Finance per month.
  • Transparent, legible and easily understood contract documents, including a financial table and standard loan terms.
  • Ready access to customer services and hardship policy.
  • Fast on-line application and approval process.

3. The key attributes of Our SACC Product meet the Target Market.

The key attributes of our SACC product meet the needs, objectives and financial situations of consumers in its target market because:

  • our SACC product:
    • provides easy access to short term finance for consumers for their infrequent and sometimes unforeseeable expenses.
    • loan amounts are closely related to the amounts required by the target market consumers in their loan applications.
    • terms match the consumers' needs, requirements and objectives, and financial situation.
  • repayments on our SACC loans are affordable for the consumer without hardship.
  • the application process is online and can be completed quickly.
  • our contract documents are short, legible and easy to understand.
  • we provide ready access to online and telephone customer service.
  • historical data shows that this product has:
    • Low Default rates;
    • Few hardship applications;
    • Few customer complaints;
    and these are within an acceptable range and indicate that the product is suitable for the target market and is meeting the customer needs, objectives, requirements and financial situations.

4. Distribution Channels and Conditions

  • All our Distribution channels present the product appropriately to consumers as follows:
    • Our website which contains:
      • No misleading information
      • All relevant disclosures and warnings required by law;
      • An easy to follow application process during which the consumer is given informed choices at every stage;
    • All third party referrers are:
      • vetted before being allowed to present our product;
      • subject to regular monitoring;
      • required to enter into referral agreements with us.
    • We do not make any unsolicited offers of credit.
  • We have adopted the following Voluntary Distribution Conditions to ensure that our product is distributed appropriately to its target market:
    • No loans to any customer whose net income is less than $400/week.
    • No more than 5 loans to the same customer within a 12 month period.
    • No loans for the purpose of paying regular, ongoing ordinary household expenses such as utilities unless it is to pay accumulated arrears or unusually high amounts due to special circumstances.
    • No loans for the purpose of pay another consumer credit debt.
  • All our products are distributed in compliance with our responsible lending obligations.

5. Review Triggers

We will review this TMD if the following occurs in relation to this product:

  • The number of customers, as a percentage of the total number of active customers, in default at the end of the quarter is 10% higher than that for the previous quarter.
  • The number of all complaints (whether referred to AFCA or not) from approved SACC loans as a percentage of the total number of Active customers at the end of the quarter is 10% higher than that for the previous quarter.
  • If the number of variations to payment schedules due to hardship is greater than 3% of the total number of loans entered into in the previous quarter.
  • The number of defaults or hardship applications before the first 3 scheduled payments for a loan as a percentage of the total number of active customers at the end of the quarter is 10% higher than that for the previous quarter.

Communication from the following external sources will be Trigger Events:

  • AFCA if either
    • Complaints resolved against us by AFCA increase by 10% as a percentage of the number of active customers in a three (3) month period; or
    • AFCA identifies a "systemic issue";
  • ASIC if it identifies a systemic issue;
  • Community based consumer organisations if they raise a systemic issue.

The responsible manager will collect, assess and review all the above data every three (3) months. If any of the above Trigger Events occur, this will trigger a review as if it were a Periodic Review as below.

6. Periodic Scheduled Reviews

  • We will conduct Periodic Reviews every six (6) months whether or not a trigger event has occurred in the previous quarter.
  • The responsible manager will conduct all reviews of this TMD.
  • The responsible manager will report to our board of directors within two weeks of conducting a review as to:
    • Whether any trigger events have occurred.
    • What factors may have caused these trigger events to occur including external factors not related to the design and distribution of our product such as seasonal variations.
    • Which of the follow actions we should take:
      • No change if all of our DDOs as published above are being met;
      • The product needs a redesign;
      • A new distribution condition is required; or
      • The product must cease to be offered.

7. Significant Dealings

If at any time, we detect that more than 5% of the consumers receiving our product within a three (3) month period are not within our Target Market, we shall report this to ASIC as a Significant Dealing within ten (10) business days.