From Sunday, the European Union (EU) will introduce new consumer lending rules to ensure consumers are informed and able to repay these loans, aiming to avoid excessive fees and excessive debt.
“From now on, consumers who finance their projects and goods through credit will be better aware of the costs they face and will be better protected from the risks of new forms of credit available ‘online’, such as ‘buy now, pay later’.” – the community leader indicates in the statement.
Marking the entry into force on Sunday of the new rules, which must then be transposed into national law by EU member states by 20 November 2025, the European Commission notes that “whether consumers rent a car to finance their online purchases, holidays or home renovation projects are less likely to end up in excessive debt thanks to the new legislation.”
At a time of high interest rates and falling purchasing power due to tight monetary policies designed to combat high inflation, the EU will introduce a new consumer credit directive that will ensure the provision of information such as total loan amounts. in a clear and understandable manner that sets stricter rules on advertising to avoid overspending and that requires lenders to assess whether consumers can repay their loan to protect them from over-indebtedness.
It also gives consumers the right to end their credit agreement within 14 days and cancer survivors the right to be forgotten.
Vice President of Values and Transparency Vera Jourova, quoted in a note published this Friday, notes that “if the cost of a loan is excessive, its terms are unclear, or its consequences are not carefully assessed, the loan becomes risky.” “, so the new directive aims to “make it easier for consumers to avoid these risks and stay safe.”
The European Commissioner responsible for justice and consumer protection, Didier Reynders, highlights “new ways of disseminating information digitally and assessing the creditworthiness of consumers”, aiming to give loans provided via the Internet “the same protection as types of traditional loans”. “
Personal loans are loans for the purchase of consumer goods and services and are often used, for example, to pay for cars, household items and appliances, and to pay for travel.
Author: Lusa
Source: CM Jornal
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