Advertising "0%" loans ban

29.07.2013 | Published in: Society news

Advertising bank loans and offer to purchase goods on credit in commercial networks today promises a 0% APR on almost any credit. Therefore, the borrower is very surprised when they actually become 0% 70%, 100%, 150%, and even higher APR. This is because banks do not indicate a modest accompanying the issuance of credit sorts of commissions and fees. The Commission shall be removed and for the repayment of the loan, but especially like the banks at any opportunity to charge all kinds of fines and penalties for minor mistakes of the borrower. Additional hidden fees and commissions in the contract lending imperceptibly small print somewhere in the end. That will have to pay a lot more than the promised advertising 0%, and the fact that the additional fees and charges he agreed, signing the loan agreement, the borrower often learns too late, when the bank has to pay more than the sum of those for which it was originally intended. In connection with this extremely relevant is submitted to parliament in early July 2013 the draft law "On Amendments to the Law" On Advertising ", which proposes to make rules according to which in the advertising of consumer credit have to provide the information on the type, the amount of the interest rate , of any fees and services (registrar fees, insurer, appraiser, etc.) are included in the overall cost to the consumer credit, term loan, the total amount and the sum of the individual (including advance) payments consumer.

With the adoption and entry into force of this law will be any assurance that consumers will be protected from the pitfalls of credit by the banks, hidden interest and commissions, etc. Banking lobby to greet the new law regulating advertising of consumer credit, with bayonets. Association "Ukrainian Credit-Banking Union" (UCBU) appealed to the parliament with arguments about the need to reject the legislative initiative aimed at introducing additional requirements on the mandatory provision of information in the list of advertisements in consumer lending. Why - is also clear: the opportunity to pick up false advertising hapless borrower and force him to pay sky-high interest rates will be lower. Bankers arguments against the new law on advertising of consumer loans purely technical. UCBU believes that the message of all the details of the loan in advertising contradicts the very idea of ​​advertising. According to experts UCBU, to provide full information to the half-minute promotional video is not technically possible, and increase the length or area of ​​advertising will make it unnecessarily expensive and uneconomical. UCBU also believes that the presentation of an advertisement in all the details and features of consumer loans is impossible for technical reasons.

In particular, the bill imposed on the lender's obligations, which can not be realized in practice: the duty to provide the consumer with information on the cost of services by third parties. In UCBU point out that the introduction of this provision is unreasonable, because the bank can not be calculated in advance the exact amount of the payment services provided by third parties and take responsibility for changing it. However, to accomplish this provision of the law really is not so difficult, as claimed by banks. Average market value of services in relation to the amount of the loan are known, the bank may well by providing information to indicate that these services will cost the borrower within the "from" and "to". But in that case, what kind of "zero" for the credit card, as it is today banking advertising claims, we can not go. In UCBU concerned that the new law, if it enters into force, will lead to a complete curtailment of advertising of consumer loans. But even without that consumer lending in Ukraine today exaggerated, and at the expense of lending to the real sector. Restrictions on advertising of consumer just necessary in view of the stability of the banking system itself. Indeed, in the case of a major economic crisis, it is the first consumer loans into being the problem.

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