The current legislative amendments integrate the stipulations of the European Parliament and Council Directive (EU) 2023/2225, dated October 18, 2023, concerning consumer credit agreements. Furthermore, these decisions introduce modifications to the Consumer Credit Act specifically addressing the regulation of operators in the peer-to-peer lending sector. A significant aspect of this overhaul is the elimination of a prior exception under the directive.
Previously, certain consumer credit agreements were exempt from the directive’s scope if interest and associated fees were not collected. Consequently, the Consumer Credit Act is being updated with new provisions governing both the assessment of borrower credibility and the principles of responsible lending practices. These updated provisions impose new liabilities on financial institutions.
Specifically, the law establishes that financial entities will be accountable based on the monthly average amount of the borrower’s installment payments across all outstanding obligations. This adjustment aims to strengthen borrower protection within the credit market. The implementation ensures that the standards set forth by the EU directive are fully transposed into national law, thereby modifying existing provisions to enhance transparency and consumer safeguards across various forms of credit provision.
Topics: #consumer #credit #provisions
