The lowest volume of new credit licences were approved in FY25 since the licencing regime began 15 years ago.
The Australian Securities and Investments Commission (ASIC) has released new data that shows the number of new Australian credit licences is continuing to fall - hitting a record low in the financial year ending June 2025 (FY25).
The Australian credit licensing regime, which was introduced in 2010 and became mandatory in 2011, largely covers lenders, mortgage managers, aggregators and some brokers (those who are not operating as a credit representative).
According to ASIC’s latest report, Report 825 Licensing and professional registration activities: 2025 update, just 104 new credit licences were granted in FY25.
This is a new record low and less than half the volume seen in some pre-pandemic years.
The regulator said it received 271 applications for new credit licences over the year, with 62 not approved. The number of licences approved was 39 fewer than in FY24.
The number of credit licences finalised over the year also dropped, with 25 per cent fewer new applications finalised in FY25 than the year before. There were 166 new applications finalised over the year.
While new applications fell over the year, the number of credit licences cancelled or suspended rose by a quarter in FY25. ASIC cancelled 54 licences and approved requests from 194 licensees to voluntarily cancel their credit licence. A further five licences were suspended.
There are now a total of 4,466 active credit licences in Australia - marginally up on the 4,616 in FY24 and the 4,665 in 2023.
The data suggests that fewer people are looking to engage in credit activities.
The continued decline in new credit licence approvals comes amid broader shifts in the credit market, as providers adapt to new regulatory requirements, rising compliance costs, and changing consumer trends.
Indeed, there has been a dearth of new banks recently - with a recent review of the small and medium-sized banking sectors voicing concern about the dominance of large investor-owned banks and the failures of several new entrants.
As such, the prudential regulator has been working on changes to make it easier for new lenders to enter market, and recently closed a consultation on changes to help aspiring banks navigate the licensing process more efficiently and reduce the time and cost associated with obtaining a banking licence.
APRA also recently announced plans to move to a three‑tiered model for banking regulation, differentiating requirements for large, medium, and small banks to help make the regulatory framework “simpler and more proportional without creating unacceptable risks”.
Where are the growth areas?
However, it is likely that the number of new credit licences will rise this financial year, as Buy Now, Pay Later (BNPL) providers are brought into the credit licensing regime.
The extension of credit licensing to include BNPL products came into effect on 10 June 2025, marking a significant expansion of the credit regulatory framework.
ASIC noted that most BNPL providers had already sought a licence before the new reforms began and warned that BNPL providers without an accepted licence application by 10 June 2025 could be engaging in unlicensed conduct if they continue to operate.
Other changes that could see an increase in the number of credit licences include the development of a new credit licensing portal.
ASIC confirmed it is developing a new credit licensing portal to streamline the application and compliance process.
The system will mirror the recently launched Australian Financial Services (AFS) licensing portal and is expected to simplify and digitise key licensing functions, including the ability to apply for new licences, vary existing licences, and lodge annual compliance certificates.
ASIC Commissioner Alan Kirkland commented: “Earlier this year we launched a new digital AFS licensing portal, a modern, streamlined platform that makes applying for a license faster and easier. And we are not stopping there – planning is already underway to apply similar improvements to the credit licence application and assessment process.
“This is a practical example of ASIC’s commitment to regulatory simplification – making it easier for the individuals and entities we regulate to interact with us,” Kirkland said.
AFSL applications on the rise
Unlike credit licences, the number of AFS licence applications increased over the year.
There was a 10 per cent increase in new AFS licence applications over FY25, at 643.
Of these, 427 new applications were finalised - a 14 per cent increase on last year’s figures.
Growth areas in the AFS regime include the cryptocurrency sector. According to ASIC, AFS applications from digital asset operators are on the rise, underscoring the growing interest in the crypto sector.
ASIC suggested more digital asset operators will seek licences in the near future, given that the regulator’s recent confirmation that a range of digital assets are financial products (and therefore require an AFS).
The number of market maker licence applications also increased, while wholesale scheme operator licence applications declined.
Overall, the ASIC report showed that, between 1 July 2024 and 30 June 2025, ASIC:
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received 1,531 licensing and registration applications (flat on FY24).
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finalised 1,176 applications for new and varied AFS and credit licences
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granted 290 new AFS licences and 104 new credit licences
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approved 450 AFS and credit licence variation applications
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registered 109 company auditors, 37 self-managed super fund auditors and 27 liquidators
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decided 77 per cent of new AFS licence applications and 76 per cent of AFS licence variation applications within 150 days
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and cancelled or suspended 215 AFS licences and 253 credit licences.
[Related: ASIC levies double for broking industry, prompting calls for a rethink]
