The new Anti-usury Act entered into force in March 2016. Since then, debates on its effectiveness have been ongoing. Proponents point out that the situation has improved significantly. Critics, in turn, are finding more loopholes that allow lenders to act unethically. Let’s check what changes the Anti-Pollution Act introduced and whether its main assumptions really allow to protect consumer goods.
Restrictions on non-interest loan costs
There is no doubt that, although the new Gambling Act still leaves some gaps, it has significantly improved and sealed the law that was functioning before. In this way, it was primarily possible to eliminate “space” non-interest fees that were used by some loan companies. It is mainly about additional fees for loan insurance, preparation fee and commission. The Anti-Mortgage Act of 2016 introduces the following limits for non-interest costs:
- Total non-interest costs may not be higher than 25% of the amount of the loan granted. However, annual costs cannot be higher than 30%.
- The total cost of financing may not exceed the amount of loan granted.
- If the lender grants another loan to the same customer within 120 days, he is obliged to include the terms of the first contract in the limits.
In this way, the new law protects against a practice in which customers were forced to pay up to several times more than the amount they borrowed. Restrictions on subsequent loans also reduce the risk of loans being rolled over incorrectly that could lead the consumer into a spiral of debt.
Strengthened supervision of the loan market
To better protect the rights of customers, the Anti-Mortgage Act of 2016 gives more powers to the Polish Financial Supervision Authority. Employees dealing with unclear matters may function with other authorities, and request the Tax Office to disclose information that is covered by tax secrecy. The new law also introduces stricter penalties for dishonest lenders who act contrary to the provisions of the Act.