I work in risk analytics in an Australian bank and would like to add my 2 cents to the original post. Banks use an applications scorecard and a behavioral score card to assess the risks associated with each individual borrower. Application score card is somewhat of a stab in the dark which is why banks will move transition into a behavioral scorecard within the 12 months. The behavioral scorecard looks at the behavior of the borrower, not so much his capacity to repay. Afterpay would do the same, and would be the reason why initially they give you a lower borrowing capacity before increasing it as your behavioral score increases.
I don't see why ASIC would come in and regulate Afterpay if they use due diligence, don't lend too much initially and then use behavioral scorecards and credit risk models to assess borrowing capacity. I don't think they are there to babysit millennial and tell them they are spending too much money on consumer products, they are there to make sure Afterpay isn't neglecting their duties to assess the borrowing capacities of individuals.
Just my two cents and all in my opinion.
APT Price at posting:
$16.89 Sentiment: Hold Disclosure: Held
