MEPs back better credit deals for shoppers

16th January 2008

SHOPPERS wanting to spread the cost of buying cars, washing machines and furniture can look forward to better credit deals and more responsible lending, under EU plans backed by Euro-MPs today.

Wales Euro-MPs Glenys Kinnock and Eluned Morgan are supporting proposals to open up the European consumer credit market while at the same time ensuring greater protection for credit consumers across the EU.

At the moment, two out of three Europeans use credit to buy furniture, washing machines or cars, but they can only use financial products that are available through their national market.

GLENYS KINNOCK said:

"By opening up the European credit market, these proposals will enable Welsh consumers to shop around and ensure they get the best deal.

"Of course, more choice must go hand in hand with consumer protection and we are building in safeguards to ensure companies across Europe don't lend irresponsibly and that consumers are aware of their capacity to repay debt."

ELUNED MORGAN added:

"A priority is to protect consumers against unmanageable amounts of debt. The information provided by the lender must enable the borrower to make a responsible decision. The lender must also assess the solvency of the consumer before lending."

The EU proposals will make it easier for banks and other financial institutions to offer their loans in other EU countries. Shoppers will also be able to compare information about financial services from different countries.

Under the plans, consumers can also look forward to better information about the available loan and guaranteed EU-wide rights including the right to cancel and the right to pay off a loan early.