Protection of consumer rights when concluding a consumer credit agreement
17 March 2020
On 4th March in an interview for Bloomberg TV Mr. Nikolay Cvetanov, Managing Partner at Penkov, Markov & Partners and Chairman of the Association for Responsible Non-Banking Lending (ARNBL), commented on the topic of protection of consumer rights when concluding a consumer credit agreement.
Mr. Cvetanov discussed the importance of the Standard European Consumer Credit Information Form as a document the provision of which to the consumer prior to the conclusion of the consumer credit agreement is mandatory. This Form does not bind the consumer in any way, but rather aims to allow the latter to become acquainted with all charges and conditions under the credit agreement and to compare offers from different companies. Here is why, as Mr. Cvetanov pointed out, this document is of great significance and must be examined cautiously.
Other issues on focus during the discussion were the need for financial planning, namely the so-called family budgeting, as well as the annual percentage rate of charges under a credit agreement. The role of organization, such as the ARNBL, in the establishment of ethical rules and practices in the field of crediting was highlighted as significant, especially upon choosing a reliable creditor. As proof of the loyalty of ARNBL’s members towards their clients was indicated the low percentage of the so-called non-performed credit agreements. Quite logically, the low percentage of such credit agreements is evidence for the good communication between the consumer and the creditor towards which all consumer credit companies should aim.
Mr. Cvetanov further presented guidelines for better reading of the statistics of the Bulgarian National Bank concerning consumer credits in the context of some incorrect understandings spread in the media.
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