Top-down regulations, in the form of the Consumer Credit Act of 12 May 2011, are intended to secure both parties to the transaction. In this case, it will be the lender and the borrower who is a natural person.
Therefore, the Act was not created only to secure the entity lending funds, but also to the ordinary consumer, who may not always boast of a thorough knowledge of the finance and banking products market. That is why the state must help him in dealing with financial institutions and protect his rights. The Consumer Credit Act is the best example of this. The legislator thus protects the weaker side of the transaction, which is the consumer.
Consumer credit – concept
The Consumer Credit Act is dedicated to this concept. Pursuant to its content, a consumer credit agreement means a credit agreement not exceeding PLN 255 550 (or the equivalent of this amount in a currency other than the Polish currency), granted by the lender as part of his business. A consumer loan agreement is also understood as a loan agreement not secured by a mortgage, which is intended for the renovation of a house or apartment, including in the amount of more than PLN 255 550.
We consider as consumer credit:
– loan agreement,
– loan agreement within the meaning of the banking law,
– a revolving loan agreement,
– an agreement to postpone the consumer to the date of satisfying the cash benefit (if it involves the consumer having to bear the costs of this postponement),
– and a credit agreement, in which the creditor incurs an obligation to a third party and the consumer undertakes to return the satisfied service to the creditor.
Where to get a consumer loan?
It is not disputed that we can apply for a consumer loan at a bank branch or credit unions. However, apart from these institutions, consumer credit can also be granted to us by financial institutions that are not banks, including loan companies or natural persons who conduct business activity.
How does it say that credit is a product reserved only for banks and credit unions? The concept of consumer credit should be considered in a broader sense in economic terms. This will allow us to conclude that consumer credit is primarily intended to determine the institution of borrowing money. In other words, it is funds or financial support provided by both the lender and the lender in any form. This is not an indication of the specific type of loan specified in the banking law.
How does the Consumer Credit Act protect consumers?
At the outset, we said that the Consumer Credit Act is to guarantee the safe borrowing of funds, including, first and foremost, the rights of the weaker party to the transaction – that is, the consumer. How does the legislator implement this postulate?
Information requirements regarding the offer
First of all, advertising and information requirements. I think every day, each of us gets at least one credit ad. When borrowing responsibly, we should be aware of the fact that it is not advertising, but the terms of the loan agreement should be the most important for us and it is them that we should focus on in particular. Cheap loans are not a catchy advertising slogan. So before we sign the loan agreement, we should read the terms in detail. Practice shows, however, that this is not always the case and our attention is focused mainly on the content of advertising. Hearing the cheapest loan, we forget about what is most important. Therefore, the legislator imposes on the advertiser the obligation to properly inform the potential borrower about the product offered.