COVID-19 Special Act – significant changes on the consumer loans market
COVID-19 most probably will have a significant impact on the consumer loan market. Today a draft of the so called COVID-19 Special Act was published on the website of Polish parliament along with justification.
The projected changes in consumer loans market are inter alia the following:
- new limitation of non-interest loan costs for consumer loans with repayment term shorter than 30 days – maximum of 5% of the body of the loan
- new limitation of non-interest loan costs for consumer loans with repayment term of at least 30 days – maximum of 15% of the body of the loan + 6% per annum, whereas currently it is 25% + 30% per annum
- in no event can the non-interest loan costs exceed 45% of the body of the loan (throughout entire duration of the loan agreement), whereas currently it is 100% of the body of the loan
- the 120 days limit rule (loan rolling ban) is extended to related entities
- breaching the above limitations can be treated as unfair market practice
- above limitations are supposed to apply for 365 days after the COVID-19 Special Act comes into force
It is unclear if the projected changes will apply to new loans, or also to the loans already granted on the day of the Act entering into force. According with the justification to the draft, new rules will apply to new agreements only, however this is not reflected in the draft act itself. Also, what is crucial – the vacatio legis is only 1 day after publishing in the official gazette.