Clune backs EU Consumers Directive
The European Parliament’s recent approval of the ground-breaking Consumer Credits Directive marks a significant milestone in consumer credit protection. Ireland South MEP, Deirdre Clune, hails this law as “a victory for consumers,” addressing critical issues arising from digitalisation and disparities in consumer protection.
This directive, part of the new Consumer Agenda alongside the General Product Safety Regulation review, aims to modernize the EU’s consumer policy framework.
MEP Clune emphasised, “Consumers need to know what they sign up for and how much they will eventually have to repay. This new law will ensure that citizens have clear information about their credit agreements.”
The Consumer Credits Directive introduces a comprehensive set of measures to enhance consumer protection for those seeking financial assistance, be it through credit cards, overdrafts, or loans. Given the increasing prevalence of online credit applications, it extends coverage to certain risky loans not addressed by the existing directive. The directive encompasses credit agreements up to €100,000 and incorporates key provisions such as imposing caps on charges, preventing excessive interest rates, and ensuring transparent annual rates.
MEP Clune underscored the directive’s core objective, stating, “This directive empowers consumers to make informed choices when seeking credit. It guarantees easy access to essential information and full awareness of credit costs. Lenders must also assess a consumer’s creditworthiness to determine their ability to repay.”
“Furthermore, the directive grants consumers the right to withdraw from a credit agreement within 14 days of signing, without needing to provide a reason, offering a valuable safety net in their financial decisions.”
Clune concluded by highlighting the importance of these measures, asserting, “These provisions strike a crucial balance, ensuring access to credit while shielding consumers from over-indebtedness. The EU Consumer Credits Directive represents a significant step toward a fairer and more transparent financial landscape, ensuring that no European citizen is left vulnerable to unsustainable debt.”