New Australian Privacy Act rules put automated lending decisions in focus

From 10 December 2026, new automated decision-making transparency requirements under Australian Privacy Principle 1 will take effect, changing how organisations explain their use of automated decision making to customers. 

The changes were introduced through the Privacy and Other Legislation Amendment Act 2024 and are designed to give individuals greater visibility over how their personal information is used in automated decisions that could significantly affect their rights or interests. 

For banks and lenders increasingly using automation and AI across lending, the changes make transparency an important consideration when designing and governing decision-making processes. 

Click here to read the official OAIC Issue Paper >> 

What changes on 10 December 2026? 

From 10 December, organisations covered by the requirements will need to provide information in their privacy policies where a computer program makes, or substantially and directly contributes to, a decision that could reasonably be expected to significantly affect an individual's rights or interests and uses their personal information. 

Importantly, the OAIC takes a broad view of what constitutes a computer program. This can include traditional rules-based processes as well as artificial intelligence and machine learning.      

Organisations will need to disclose the kinds of personal information used, the kinds of decisions made solely by these programs, and the kinds of decisions where programs perform something substantially and directly related to making the decision.      

What does this mean for banks and lenders? 

The implications are particularly relevant to Financial Services. The OAIC Issues Paper specifically identifies access to essential banking and credit services when considering services that could significantly affect an individual's interests. 

For lenders, this means understanding where automated systems are used throughout decision making, what personal information those systems use and how their outputs influence customer outcomes. 

Human involvement does not necessarily remove an activity from consideration. The OAIC notes that a computer program may recommend or guide a decision made by a person where its output is a key factor in that decision. 

Banks also need visibility over third party technology. The OASIC Issues Paper states that organisations should actively identify, assess and maintain oversight of how third-party products and services use automated decision making. 

How Cloudcase is addressing the challenge 

Cloudcase is designed to help financial institutions maintain greater control and visibility over lending decision making within a single loan origination environment. 

Our native AI capabilities work alongside configurable decision rules, workflows, lending data and human expertise rather than operating as a separate application. This approach can help lenders establish clear boundaries around where AI is used, incorporate human review and override, maintain auditability and apply consistent governance across the lending process. 

As transparency becomes increasingly important, having AI, decisioning, workflow and human oversight working together can help financial institutions understand how technology contributes to lending outcomes while continuing to deliver faster, better customer experiences. 

Want to understand how Cloudcase can support your lending and AI strategy? Contact our team to learn more.