Part of an article in the online Fin Review "Credit Corp's...

Part of an article in the online Fin Review
"Credit Corp's website says: "At Credit Corp, we set operational standards at levels significantly above minimum legal requirements. We have a strong compliance culture supported by a control framework to ensure that we adhere to the standards we have set for ourselves."
The Checkmate report, however, also makes accusations of "earnings management" by Credit Corp.
"Reported net margin is too smooth when compared to peers, ASX-listed small cap companies and CCP's own history; ratio of collections to amortization is too smooth when compared to peers and CCP's own history; loan loss provision expense/interest income ratio was unchanged at 44.4 per cent for three consecutive years (FY 2015-2017); in FY 2016 CCP transferred $50 million of assets from the lending segment to the PDL segment without providing any disclosures; the company understated losses at its US debt purchasing business at least in FY 2015 and FY 2017," it said.

Checkmate is also raising questions around Credit Corp's control systems and its auditor Hall Chadwick.

Locally, the big banks have been cautious on the payday lending sector in the past five years.
In 2015, Westpac announced it would no longer finance payday lenders, a move that forced companies including Cash Converters and Money3 to obtain some of their funding elsewhere.
After a review of its involvement in payday lending, at the time Westpac said had made a "commercial decision" to cut ties with the industry."