Solvency analysis and more transparency, keys of the Ministerial Order on “revolving” cards that comes into force this Saturday

Confilegal | 01/01/2021 6:47 | Updated: 12/31/2020 4:17 PM

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After a year marked by the judgment of the Civil Chamber of the Supreme Court (149/2020, March 4) that you considered Usury revolving card contracts with interest rates higher than 20% The judgments have followed one another giving the reason to the consumers in front of the banking entities.

This Saturday, January 2, the Ministerial order designed to regulate the marketing of revolving cards.

“Both the judiciary and the legislature are realizing the importance of the problem with revolving cards. Too many people turned to this type of financing in the crises of 2008 and 2012, and now, seeing how attractive these loans are in times of need like the current one, we must combine all possible efforts to prevent people from becoming over-indebted while the banks profit, “he explains Javier Moyano, CEO of Reclama Por Me.

This order, in his opinion, «represents a further step for protect the consumer from abusive practices of the entities that market them.

And, this financial product allows you to make any payment at the time without having money, paying the entity monthly previously agreed fees. «Despite their apparent facilities, they hide great dangers ».

They are characterized by lack of transparency in its marketing and interests disproportionate to the real value of money at the time of contracting, which leads the client to become over-indebted by not being able to pay the amount that the entity claims.

These practices are not only given by banks and credit institutions, but also there are also well-known establishments, such as gas stations, supermarkets or clothing stores, which market these cards taking into account the discounts and facilities they offer when financing purchases.

For this reason, as of this Saturday an Order, promoted by the Ministry of Economic Affairs and Digital Transformation, will come into force, which will bring with it some more in-depth analysis of applicants’ conditions before awarding credit and the obligation that they are fully informed.

To claim for me there three key points of the Order on revolving cards to take into account:

1. From now on, Institutions will not be able to grant revolving cards without first ensuring that applicants can cover the annual amount of fees without problem.

The order states that they must allow the consumer repay a minimum of 25% of the loan annually so that it is not perpetuated in time.

2. The client must be informed before and during the contract of all its characteristics. This is how you want to get a clearer information and greater transparency, which implies greater protection for the consumer.

“Institutions tend to omit important information on revolving loans, both when marketing them and throughout the life of the contract, so that clients can access their contract. Having been aware of what these cards have implied for thousands of affected, probably many would think twice »says Moyano.

In this sense, he assures, «the new order comes to put an end to this problem and it will ensure that those affected, who are usually in a vulnerable situation when contracting credit, are more informed about the risks.

3. Finally, the entities that offer these loans will have to inform the Bank of Spain about those customers who have credits from 1,000 euros, instead of the 9,000 that were previously established.

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