From the first day of this month, new rules for microcredit companies began to work within the framework of the Basic Standard, which was developed by the regulator together with market participants and self-regulating organizations.
Now, during the year one borrower cannot take a payday loan more than ten times. We are talking about the so-called loans before paycheck – small loans that are issued for no more than 30 days. This rule will work until the end of 2018. All this information is specified in clause 3 of Article 10 of the Basic Standard. From January 1, 2019, the maximum number of such loans per person per year will decrease to 9.
Specification of maximum number of Payday Loan
Simultaneously with the beginning of the action of paragraph 3 of Art. 10, Article 13, paragraph 1, entered into force, which specifies the maximum number of prolongations for payday loans. Now the client of the payday loan company will not be able to conclude more than seven additional agreements for one year in order to extend the loan repayment period. The next two years, the number will constantly decrease. Thus, from April 1 of next year, it will not be possible to extend the loan more than 6 times during the year, and from January 1, 2019, the Payday Loan will not be able to extend the contract with the borrower more than 5 times.
Strengthen the rights of payday loan users
All these and other innovations that the TPO Bank is introducing are being developed in order to strengthen the rights of payday loan users and improve the situation in the microcredit market as a whole. You can learn more about the Basic Standard for Protecting the Rights and Interests of Individuals and Legal Entities – Recipients of Microcredits, available on the TPO Bank website.