The third Tuesday in September is over again. The speech from the throne has been read. Perhaps you have also heard the consumer credit pass by and you no longer know exactly what it is all about. Time to take stock.
Home shopping organization with VFN code of conduct
Home shopping organizations (such as Wehkamp) must adhere to the code of conduct of the Association of Finance Companies (VFN). This means that customers who are not eligible to take out a loan in a responsible manner (according to the standards of the Nibud and VFN) can now also not take out a credit card, mail order credit or store card. Previously this was often possible because these organizations had a much smoother acceptance policy. In the future you can therefore only take out responsible loans.
Tightening up the code of conduct
The impetus is given to further tighten the codes of conduct of the VFN and the Dutch Banking Association (NVB). Presumably now, the red stock is also being looked at, as the red stock is also a form of credit. Also in this case it would be logical that only consumers who meet the standards of the Nibud / VFN are eligible to be in the red. The NVB does not currently use these standards.
From a political point of view, this is a sensitive point of view, as being red is a major source of income for banks.
Customers with payment arrears
A more careful approach of lenders to customers with payment arrears will become an important spearhead in 2019. Defaulters should not immediately get the knife in their throats, but the banks are supposed to pull together. What is the reason that the customer does not pay? What is the status of the customer’s income and fixed costs? In short, the banks must comply with their duty of care, think along with a solution and offer customized solutions to consumers.
Legal maximum credit compensation
From next year, lenders will have to comply with the statutory maximum credit payment of 14% on an annual basis. This means that credit providers may not charge extra costs in excess of those 14%, even in the case of arrears.
Offer good choice environment
Lenders and intermediaries of consumer loans are required to provide a good choice environment for their customers. That means that no manipulation can be made when providing information. According to the ministry, credit providers have taken steps to be more customer-oriented and to focus less on high and long-term loans. The minister expects providers of shipping house credit to make additional adjustments to reduce the percentage of payment arrears. In addition, he calls on the entire industry to put the customer more centrally in the codes of conduct.
Investigation into credit warning alternative
The slogan ‘borrowing money costs money’ does not appear to have an effect on the behavior and attitude of the consumer when taking out a loan, as intended. That is why Minister Hoekstra wants to get rid of this slogan and a more effective credit warning must be introduced instead. This is to protect vulnerable people against sky-high debts.
Better consumer protection
The consumer must be better protected by the ‘revision of the seizure and enforcement law’ bill. It is likely that customers who, due to the facts of life, such as a divorce, disability, death or losing their job, will end up in a problematic debt situation will be better protected. If there is little or no prospect of recovery, seizure and execution right may no longer be applied. In this case too, the duty of care of the lender is invoked.
The minister has announced three policy objectives to better protect consumers in the lending process, namely:
- In the borrowing environment, there is no steering towards a higher borrowing amount or a longer duration
- Providers are expected not to portray the image that borrowing is ‘normal’
- The lending environment must be arranged in such a way that consumers realize that they are taking out a loan with the corresponding obligation to repay this loan, including interest.