Consumer Credit : Consumers at risk

In the context of the ongoing negotiations between the three Institutions on the proposal for a Directive on Consumer Credit, BEUC, the European Consumers’ Organisation, is calling on decision makers and especially MEPs to turn the tide, and not water down any further the protection and the positive points seen in the Council’s Common Position.

There are a number of points which we find worrying, particularly the fact that:

•  The scope of this directive is too narrow: in particular, overdrafts and equity releases are not covered.
•  The provisions on lenders’ liability, which are essential to protect consumers against over-indebtedness, are not adequately addressed.
•  More importantly, the provisions on early  repayment are much too vague on the issue of lenders’ rights to compensation. There is a  real danger that when put into practice, they would leave consumers with no possibility of  early repayment and financial mobility. These provisions are completely unacceptable, and if they remain unchanged, this directive will have been a complete waste of time.
•  Moreover, we are afraid that the decisions which are taken now will influence the forthcoming debate on mortgage credit; another area where we have been waiting all too long for binding legislation.
“We have been waiting for five years for legislation to put an end to the numerous problems which consumers are facing on a daily basis; unless MEPs change their approach, this directive will prove to be useless; worse, some of the best national consumer protection measures could even be removed” declared Monique Goyens, Director General of BEUC.

BEUC was created on 6 March 1962 by the consumer organisations of Belgium, Luxembourg, France, the Netherlands, Italy and Germany. After working together for a number of years, these organisations decided to create a European association, based in Brussels, right at the heart of Community policy. BEUC was a pioneer, one of the first lobbying organisations to set up base in the European capital in a bid to influence the decision-making process.