ASIC flags budgeting group for unlicensed financial services

In a statement, ASIC said an investigation had found that MyBudget, which holds an Australian Credit Licence, was "providing services to its clients via a non-cash payment facility, which would require the company to hold an AFS licence”.

MyBudget customers are provided with a budget plan to meet their financial objectives and goals, and clients then deposit their income into a MyBudget account, which facilitates the distribution of funds in accordance with the plan.

ASIC said the company had been brought to its attention when it suffered a ransomware intrusion that meant 13,000 clients were unable to access their online account for at least seven days.

"ASIC was particularly concerned about unlicensed financial services conduct by an entity providing debt management services during the COVID-19 pandemic, when more consumers may face financial hardship and seek budgetary and related assistance," the regulator said.

ASIC said the company had now applied for an AFSL and the regulator was assessing the application.