Definitions and Glossary of Terms

Definitions

AFIA Online Small Business Lenders Group means the AFIA Online Small Business Lenders Group that has been established under the terms of the By-Laws.

By-Laws means the AFIA Online Small Business Lenders Group By-Laws, as approved by AFIA’s Board, as amended from time to time.

Code Compliant Member means an AFIA Member that has been approved as a Code Compliant Member under the By Laws.

Code Signatory means a Code Compliant Member.

Glossary means the Glossary of Terms set out in this Code.

Industry means that section of the loan market in which the Code Signatories are participants as lenders to business customers under any Loan Products.

Loan Products means a loan contract that is an Online Small Business Loan.

National Credit Code means Schedule 1 in the National Consumer Credit Protection Act 2009 (Cth).

Online Small Business Loan means a loan which has a Term and where:

a. the finance is provided (or to be provided) for a purpose that is wholly or predominantly a business or commercial purpose and where the National Credit Code is not applicable to the finance provided (or to be provided); and

b. the finance provided (or to be provided) is:

i. unsecured (with or without a guarantee); or

ii. secured by any form of security that is not a mortgage over land in registerable form.

For the avoidance of doubt, the following types of finance, or any arrangement of a similar nature, are not an Online Small Business Loan for the purposes of this Code:

a. equipment finance in which the lender has an interest of any kind in the financed goods or equipment;

b. a rental agreement or instalment purchase agreement;

c. an operating lease;

d. a finance lease;

e. invoice financing of any kind; and

f. a factoring arrangement or finance facility.

Glossary of Terms

Annual Percentage Rate is the rate that can be used to calculate the cost of the loan, taking account of the reducing balance of the Loan Amount, expressed as an annual rate. (For these purposes, the cost of the loan is exclusive of fees.)

Average Monthly Payment is the Total Repayment Amount divided by the Term. The Average Monthly Payment amount does not include fees and other charges you can avoid, such as interest at a default interest rate on overdue amounts, late payment fees and dishonour fees.

COD (Cents on the Dollar) is the amount of the Interest Expense and Other Fees (if any) that is payable for each dollar borrowed. The amount is exclusive of any Origination Fee.

Direct Debit Fee is fee charged by the lender to a borrower, if any, for requesting the drawdown of funds from the borrower's nominated account, where the request is made under an authority granted by a Direct Debit Request.

Disbursement Amount is the amount of the loan that is available for disbursement and may be less than the Loan Amount.

Dishonour Fee is the fee charged by the lender where you fail to pay an amount that is due and payable to the lender under the Loan Contract.

Early Repayment is the early repayment of the loan amount, as well as the payment of all amounts that you are required to pay under the Loan Contract.

Fees are all fees payable, or that may become payable, by you to the lender under the Loan Contract.

Interest Expense is the interest charge, or charge for the cost of credit, that is payable by you under the Loan Contract. The Interest Expense does not include any allowance for Fees that are separately payable under the Loan Contract.

Late Payment Fee is a fee charged by the lender where an amount due and payable under the Loan Contract has not been received by the lender within the required time for the payment of that amount.

Loan Amount is the total amount of the finance made available, or to be made available, under the Loan Contract.

Loan Contract is a loan contract that is an Online Small Business Loan Contract.

Other Fees are fees that will be charged by the lender to a borrower under the Loan Contract that is not an Origination Fee or Interest Expense and that is not contingent on the occurrence of any later event.

Origination Fee is any fee charged by the lender that is to be deducted from the Loan Amount prior to or at the time the Disbursement Amount is made available to you.

Term is the period, expressed a number of months (including any part of a month), over which the Total Repayment Amount is to be paid by you to the lender.

Total Cost of Credit is the total amount you will pay in Interest Expenses and other fees for the Loan. The amount does not include fees and other charges you can avoid, such as interest at a default interest rate on overdue amounts, late payment fees and dishonour fees.

Total Interest Percentage is the Interest Expense expressed as a percentage of the Loan Amount. The Total Interest Percentage is exclusive of fees.

Total Repayment Amount is the total amount that you will pay to the lender, comprising the Loan Amount, the Interest Expense, and Other Fees. The Total Repayment Amount is exclusive of any Origination Fee.