The European Commission published a proposal for the review of the Consumer Credit Directive (CCD) in June 2021. The EACB has carefully reviewed the proposal and compliments the Commission on the careful stakeholder process undertaken.
The cooperative banks highlight the following priorities with regard to the proposal put forward:
The EACB supports the extension of the scope to include new market players and crowdfunding services to reinforce the level playing field and consumer protection standards. However, we express strong reservations against the expansion of the scope to include credits such as those of short-term and low-value nature, which may lead to either increased costs to consumers or disappearance of such credits services.
Secondly, consumers demand clear and simple information. This is not reflected by the proposed additional information requirements as the proposal - with the additional Standard European Consumer Credit Overview form - leads to no less than a four-layered information obligation. Such information overload will increase the cost of credit and confuse the client without increasing the quality of the information.
Moreover, the proposal should refrain from adding further requirements with regard to the creditworthiness assessment, that is of the interest of both consumer and creditor. Creditors are also already obliged to avoid negative effects of an improper creditworthiness assessment as per regulatory, risk management and civil obligations.
Finally, the proposed caps on interest rates, APRC (Annual Percentage Rate of Charge) and the total costs of the credit to the consumer project an obligation for Member States to conduct price interventions. Such obligation is not justified. It should be left to Member States’ discretion if and when caps are necessary and for what kind of product or business.
We kindly invite you to look into our position paper for more details.