Consumer Credit (Amendment) Bill 2022 will restrict rate charged by moneylenders, modernise the sector and better protect those in need of short-term money lending - Donohoe
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Published on
Last updated on
The Minister for Finance, Paschal Donohoe, TD, today (Monday) welcomed publication of the Consumer Credit (Amendment) Bill 2022.
The main purpose of this Bill is to restrict the total cost of credit on moneylending loans.
The Bill will restrict interest rates by providing the Minister for Finance with the power to make regulations setting the maximum interest rate at which a moneylending loan can be provided, and by prohibiting moneylenders from charging for home collection services.
The Bill also contains a range of measures to modernise and streamline the sector, including:
The legislation follows a comprehensive review of the moneylending sector undertaken by the Department of Finance and the proposals take into account the submissions received during the public consultation held by the Department in respect of the issue. Minister Donohoe published a Moneylending Policy Proposals Report on reform of the moneylending sector in July 2021.
Speaking today, the Minister said:
‘This Bill will reduce the cost of credit for the customers of moneylenders. The legislation also introduces a range of measures to reform and modernise the moneylending sector. These measures will provide better protection for consumers and will streamline the licensing process for providers.’
ENDS
Note to Editors
The Bill will restrict interest rates by providing the Minister for Finance with the power to make regulations setting the maximum interest rate at which a moneylending loan can be provided.
The Minister is required to have regard to the following factors and to consult the Central Bank of Ireland before making such regulations:
In making the regulations, the Minister must also adhere to the following parameters:
o the maximum rate of simple interest chargeable per week can only be set at a rate less than or equal to one per cent, and
o the maximum rate of simple interest chargeable per year can only be set at a rate less than or equal to 48 per cent,
Information on the market
Relevant links:
Explanatory Memorandum - Explanatory Memorandum - Consumer Credit (Amendment) Bill 2022
Regulatory Impact Analysis on the Bill - RIA Consumer Credit (Amendment) Bill 2021
Moneylending Policy Proposals Report - Moneylending Policy Proposals