The Federation of German Consumer Organizations (vzbv) has taken a position on the planned revision of the EU Consumer Credit Directive. In particular, the consumer advocates criticize attempts by the EU Council and Parliament to water down the far-reaching draft by the Commission in the so-called trilogue procedure through exceptions.
Unlike the Commission, the Council and Parliament do not want to generally lower the previous de minimis limit for detailed creditworthiness checks from 200 euros to zero. In contrast to this, they also want to largely exempt interest-free installment payments and purchases on account (also known as “buy now, pay later”) from such checks.
Parliament would also like to weaken requirements according to which consumers may only receive loans if they can “probably” repay them according to the result of the examination. The Council and Parliament have also spoken out in favor of national regulations on upper limits for interest rates, annual percentage rate of charge and absolute borrowing costs, while the Commission favors a uniform EU regulation.
Protection against over-indebtedness
The vzbv is now calling for the strictest variant in each of the three drafts to be introduced to protect consumers from over-indebtedness. With the revision draft, the Commission had reacted to the increasing digitization. In particular, she wants to regulate Internet financial service providers such as Klarna and PayPal as well as large retailers such as Amazon more strictly. For years, consumer advocates have been a thorn in the side of their marketing and the generous allocation practice to vulnerable groups.
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