ASIC’s Car Finance Review Puts EV Buyers on Notice

ASIC reviewed data from more than 350,000 car loans across eight finance providers and raised concerns about how some loans are distributed through third parties such as dealers and brokers. The regulator pointed to issues including weak oversight of distributors, high fees, high interest rates, poor monitoring of borrower outcomes and vehicle purchase prices that could sit well above lender-verified values. For households already worried about approval, repayments and hidden charges, the message is clear: the cheapest-looking deal at the dealership may not be the cheapest deal over the full loan term.

One area of concern was the way some short-term loan structures, including Guaranteed Future Value arrangements, were promoted through dealership channels. These products can suit some buyers, but they may come with conditions around kilometres, vehicle condition and end-of-term choices. For EV buyers, those details can be especially important because battery warranty, charging habits, depreciation and future model pricing may all affect whether the structure remains suitable.

The practical takeaway is not that buyers should avoid finance, but that they should slow the process down and compare the full picture. Before signing, check the comparison rate, establishment fees, monthly account fees, balloon payments, early payout costs and any dealer add-ons rolled into the loan. If you are buying a used EV, also consider whether the financed amount lines up with the vehicle’s age, battery condition, warranty status and realistic market value.

For many Australians, an EV can still be a sensible way to reduce petrol exposure and running costs, particularly when charged at home or through low-cost electricity plans. But the finance decision needs to stack up independently of the environmental or fuel-saving benefits. It is worth using an EV loan calculator to test repayments under different deposits, rates and terms before committing.

This story also extends the recent trend of rising EV finance demand in Australia. As more buyers enter the market, scrutiny of loan quality becomes more important. The safest approach is to compare EV loan options, understand the total payable amount, and avoid being rushed by sales pressure at the point of purchase.