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Consumers sometimes need an additional source of financing in order to make a larger purchase. To this end, they can take out consumer credit.

Information for consumers

When choosing the most suitable credit and comparing offers it is important to have all information about the credit at your disposal. This type of information is called pre-contractual information and must be provided to you by the creditor on a standard form. You can ask several creditors to provide pre-contractual information and then choose to sign the credit agreement best suited to your needs. You need to be informed about the amount of money you will receive, the amount of the monthly instalments, costs and other credit specifics (interest, default charges, deferred payment).

In order to prepare pre-contractual information, the creditor may request certain information from you (personal information, information on inflows, your consent to check your current indebtedness).

Before concluding the agreement, make sure to carefully read all the documents and request additional information from the creditor if you have any further questions. Do not sign blank credit agreement forms or other documents.

Credit agreement

A credit agreement must be drawn up in writing on paper or another durable medium (for example on a hard-drive or e-mail) and include the information that is required by the act regulating consumer credit. 

Default interest or costs of late payments in the agreement must not be higher than the real costs and the amount of default interest provided for by the act regulating statutory default interest rate.

Before signing the agreement make sure to read it carefully and refuse to sign if the amount stated in the agreement is higher than the amount received. As a rule, the credit must be repaid to the current account of the undertaking (the creditor) and not in cash without a proper receipt.

Withdrawal from the credit agreement

If the credit agreement is not concluded in accordance with the act governing consumer credits, you may withdraw from the credit agreement within one month from paying the first instalment. You must then repay the amount received within eight or ten calendar days , but without interest or other costs and the creditor must refund you the paid instalments within eight calendar days.

The Consumer Credit Act states that the highest admissible effective interest rate of non‑bank credit should not exceed 200 per cent of the average effective interest rate used by banks and savings banks.

The consumer can withdraw from the credit agreement without stating the reason in 14 days after the credit agreement was concluded, even if they have already drawn the credit. The consumer must pay the creditor the principal and the interest charged on principal without any undue delay and no later than 30 calendar days after submitting the notification on the withdrawal from the credit agreement to the creditor.

The interest of the drawn credit is calculated on the basis of the agreed borrowing rate. The creditor is not entitled to any other compensation from the consumer, except compensation for any non‑returnable charges paid by the creditor for a procedure before the court, to any public administrative body or to persons with public authorisation. 

In the case of loan agreements concluded between natural persons, the rights or persons are not protected under the act regulating consumer credit. In the event of a dispute arising from such loan agreements, the competent court has the jurisdiction to resolve the dispute.

Concluding agreements with credit intermediaries

For greater consumer protection, credit intermediaries (e.g. traders) must have concluded a contract with the creditor. The intermediary must inform the consumer whether they are working with one or more creditors. The credit intermediary may not charge their services to the consumer and may also not request nor accept the consumer's payment of financial obligations on behalf of the creditor for which they act as an intermediary in the conclusion of agreements.

Conditions for the provision of consumer lending

Creditors from the non‑banking sector who wish to provide consumer lending services must obtain a consumer lending licence from the Ministry of Economic Development and Technology prior to the provision of services. 

In order to obtain or renew a consumer lending license, the creditor must meet the staffing and educational qualification requirements, as well as spatial, technical and organisational requirements provided in Articles 2, 3 and 4 of the Rules on conditions for providing consumer lending.

Supervision of creditors

In case of infringements, creditors can be fined and in certain cases their consumer lending license can be revoked.

Supervisory body, responsible for the supervision of creditors from the non-banking sector:

 

Supervisory body, responsible for the supervision of creditors from the banking sector

Supervisory body, responsible for the supervision of creditors from the banking sector