Current Issues in Consumer Law 2/2012
Excessive charges for postponing debt settlement date abolished
The Consumer Ombudsman has intervened in the matter of due date postponement charges deemed excessive, pursuant to the new provisions on good lending practice in the Finnish Consumer Protection Act.
Under the terms and conditions issued by Vipster Oy, a company that grants fast loans, the lender has had the opportunity, before the debt is due to be paid, to postpone the settlement date by 7 to 21 days by making a payment into his online bank tied to the amount of the loan and the length of the extension. For example, postponing the settlement date for a loan of 200 euros by 21 days will cost the lender 32 euros.
Under the provisions on good lending practice in the Finnish Consumer Protection Act, the Consumer Ombudsman has taken the view that a consumer cannot be charged for postponement of the settlement date any more than could be demanded of him for delaying repayment for an equivalent length of time on the basis of the Finnish Debt Collection Act.
Under the Act, a creditor has the right to demand a maximum of five euros for a reminder sent no earlier than 14 days following the date on which the debt is due to be paid. So, under good lending practice, a consumer cannot be charged anything for postponing a settlement date by less than 14 days. And a maximum of just five euros can be charged for postponing the settlement date by more than 14 days but less than a month.
The company said it would change its terms and conditions accordingly.