Do I Need a Licence to Collect My Own Debts?

Licensing varies by state and activity

Australia does not have a single national debt-collection licence. Requirements depend on the state or territory and on the kind of activity involved — and they can differ for a creditor collecting its own debts versus an agent collecting on another's behalf. What is required in one jurisdiction may not be required in another, and the position can change over time, so a general impression is a poor substitute for checking.

Because the rules are not uniform, the safe approach is to confirm the position for your particular jurisdiction and your particular conduct rather than assuming that what you have heard elsewhere applies to you. Treat licensing as a threshold question to answer before you begin, not a detail to consider only if a problem arises. Getting clarity early avoids the awkward position of discovering a requirement after the fact.

Desk-based versus field activity

The nature of the activity often matters as much as who is doing it. Certain field-agent activities — such as attending premises or repossessing goods — can attract licensing or registration requirements that desk-based collection through letters, calls and email may not. The distinction is not always intuitive, and the way an activity is characterised can affect how it is treated.

Mischaracterising your activity, or assuming a licence is unnecessary because the debt is your own, can create exposure. It is therefore worth understanding precisely what you are doing, how it is classified where you operate, and whether any step you are contemplating shifts you into territory with additional requirements. If your collection is likely to involve field activity at any point, that is a strong prompt to take advice or to engage a partner whose compliance is already established.

How Merion approaches it

Merion operates across Queensland, Victoria, New South Wales and the Australian Capital Territory and structures its operations to comply with the relevant state and federal regulations for the activities it undertakes. Because it does not engage in field-agent activities, its position differs from that of agencies that do — a reminder that licensing depends on what is actually done, not simply on being in the collection business.

Engaging a partner that manages these considerations spares you from having to interpret a patchwork of state rules yourself, and gives you confidence that the activity carried out on your behalf is conducted on a sound footing. The Trust Centre explains this posture further and sets it in the wider context of Merion's compliance approach.

Check before you assume

Whether or not a licence applies to you, the responsible step is to confirm the position for your activities and jurisdiction with a qualified adviser, or to engage a professional partner whose compliance is already established. The cost of checking is small; the cost of an unlicensed activity discovered later can be significant, and may taint otherwise legitimate recovery efforts.

Above all, treat licensing as a question to answer rather than a detail to overlook. Assumptions — that your own debts are exempt, that desk-based work is always fine, that the position is the same in every state — are precisely where creditors come unstuck. A short conversation with the right adviser or partner usually resolves the question quickly and lets you proceed with confidence.