Issue & Summary

Private schools have, from time to time, asked whether they can obtain credit checks on in respect of payment of school fees. Some think not.

I recently had to look at the issue, and now summarise my view. There is “no one size fits all” answer.

The position of each school would need to be considered individually and each School would have to obtain its own legal and accounting advice.

Background and Basics

Many private schools will have a turnover[1] sufficient to attract the operation of the Commonwealth Privacy Act and therefore the Australian Privacy Principles.

Some Schools understand that they can not conduct “credit checks” nor report default as schools are not “credit providers” for the purposes of the Privacy Act 1988 (“Privacy Act”).


Privacy Act, section 6G presently deals with “credit providers”.

In my view:-

  • “Credit”, for the purposes of the above section, is relevantly defined under the Privacy Act in a way to include the deferral of the debt, which could apply to school fees;
  • depending on details of the particular payment plan, .it is a question of fact, whether the extent and detail (including instalments and or interest arrangements) of the deferral and fee payment arrangements of particular schools amount to conduct falling within the definition of “providing credit”;
  • a school could constitute a “credit provider”.

Whether a particular school is within the definitions depends upon details of a particular schools’ operations.


Some private schools consider themselves to be “credit providers”, for the purposes of the Privacy Act and some have published credit reporting policies where they stipulate that they are a ‘credit provider’ with in the definition of the Privacy Act, as they offer deferrals of payments such as school fees and tutoring fees. The policies set out material such as:-

  1. scope of the credit reporting obligation;
  2. types of information the schools are allowed to collect;
  3. use of information;
  4. when information can be disclosed.


Depending on the circumstances of each individual school[2], some schools can be classed as ‘credit providers‘ under the Privacy Act and, so, may be involved in credit checks and credit reporting.

Schools wishing to consider the issue further can ask me to comment on their particular circumstances.

Nothing In this Discussion Paper is intended to be and is not to be taken to be legal  advice to any particular school or individual.

Practical Options For Consideration

In context of concerns historically raised which hinder “credit checks” (and noting that this note does not tell schools whether their operations attract “credit provider” and hence “credit reporting” provisions), there are options available for dealing with credit worthiness of school fee payers particularly for schools not able, willing or prepared to be involved in providing credit or credit reporting.

With many schools having a need to ensure payment of school fees and the like, I prepared a Discussion & Options Paper for schools to consider.

if you want a copy of my Discussion & Options Paper, send me an email and I will send it to you.

Greg Ross


[1] Over $3,000,000.00 per annum. To the extent private schools having a smaller turnover provide “health” services in respect of students, those laws will be similarly attracted- Section 6D, Privacy Act.

[2] Such as turnover and the period of which payments are able to be deferred and interest being charged.