The Financial Markets Authority seems fine with Harmoney. But the Commerce Commission is suing it because it can't figure out who is the lender (the peer-lenders, or Harmoney), and whether Harmoney's fee-structure is then consistent with a pile of other regulations or not.
A regulator could scarcely be more destructive without procuring a giant wasps’ nest, agitating it vigorously and releasing it into the previously calm interior of its victim’s compact Parnell office space.The problem comes of stupid legislative drafting saying that a credit fee cannot be "unreasonable", but that doesn't define unreasonable. And so it gets more confusing:
It doesn't get better from there. FMA seems to have the more sensible position, and scraps with the Ministry and Commerce Commission about it; Harmoney's stuck in the middle. Hunter suggests it could all have been solved by clearer regulation just requiring lenders to disclose the APR: the annual percent interest rate equivalent inclusive of all fees.
File under: Not the outside of the asylum.