Banks will be excluded from the bill on limiting the maximum interest rate on loans.
These and other proposals will be included in the draft amendments to the Banking Law and the Law on Non-Banking Credit Organizations aimed at strengthening the protection of consumer loans following public consultations with businesses organized on Tuesday. The head of the parliamentary commission on economy, budget and finance, Dumitru Alaiba, said that the bill had been finalized for approval by the parliament in the second reading, and the proposed changes were submitted to all market participants. In particular, this draft law will not apply to the banking sector, the maximum interest rate on a loan will be limited to 65%, and a transitional period for implementing the law will also be provided. During the discussions, AmCham Executive Director Mila Malairau noted that this bill will affect the non-bank lending market, which plays an important social role in providing consumer financing. However, there are not so many abuses by Non-Banking Credit Organizations, so it is necessary to consider specific cases of abuse in more detail, while strengthening work in the field of improving the financial literacy of the population. Representative of Microinvest Dumitru Svinarenco, in turn, noted several negative aspects of the bill, which is discriminatory. “If our goal is to protect consumers of financial institutions, then the rules should be the same for everyone, including banks. Secondly, it is necessary to formulate in the law a limitation on the cost of only consumer credit. This should not apply to lending to professional players. In addition, the law should not be applied retroactively, it is necessary to comply with the principles of predictability for business. If the law starts to apply to existing contracts, then Non-Banking Credit Organizations will work under contracts below cost. This may lead to default in relations with foreign partners who lend to non-bank credit organizations, applying international standards in this area,” said a representative of Microinvest. Recall, according to the draft law adopted in the first reading, it was originally proposed to limit the loan interest rate in the loan agreement at 50%, and also to provide that all other expenses (commissions, fees, fines, late interest and any other payments), which are included in the total cost of the loan, excluding interest, for one credit day did not exceed 0.04% of the total loan amount. The total cost of the loan, including interest, fees, penalties, interest for late payment and other payments, must not exceed the total cost of the loan. The draft law also provides that before concluding a loan agreement, the bank, Non-Banking Credit Organizations or savings and loan associations must assess the borrower's bonitet (the borrower's ability to repay the loan) in accordance with the principle of responsible lending. // 29.03.2022 — InfoMarket
