New consumer loan anti-usury laws
On February 18, 2019, a bill amending certain acts on usury counteracting, i.e. anti-usury law, was published.
From the point of view of loan institutions, the main assumptions of the bill include:
(a) lowering (tightening) the limit of non-interest loan costs up to 20% of the capital (total loan amount) increased by 25% of the capital annually, with an upper limit of 75% of the total loan over the entire loan period (currently these amounts are 25%, 30% on an annual basis, with an upper limit of 100% of the total loan amount),
(b) the obligation to obtain from the consumer and attach to the consumer loan agreement a statement on the consumer’s income and expenditure in the scope necessary for the assessment of creditworthiness and credit risk analysis,
(c) the obligation to verify the statement referred to in point (b) above in Economic Information Bureau (BIG) or the institution appointed on the basis of art. 105 para. 4 of the Banking Law,
(d) a prohibition of disposal and recovery by loan institutions of claims under a consumer loan agreement granted in violation of the provisions of the Act or in a situation where the statement referred to in item (b) above indicates that at the date of the contract the consumer had arrears in payment of another liability of more than 6 months,
(e) loan institutions started to be supervised by the Polish Financial Supervision Authority,
(f) stricter requirements for advertising consumer loan.
The proposed amendments – apart from the just assumption of the fight against usury – may seriously affect the market of legally operating loan institutions, including, in particular, the profitability of these institutions, and the lending process itself, which will probably become longer and more expensive.
Feel free to contact our Law Office, which offers services in the area of creating loan institution models compliant with consumer regulations.