Finance Minister says legislative amendments to protect citizens from banks

Legislative amendments to limit current account overdrafts, the possibility to impact housing loan interest rate trends, and preventing the seizure of an entire salary are part of a programme whereby the government wants to help citizens come out of their dire debt situation, Finance Minister Slavko Linic said on Tuesday.

Linic was speaking to the press in the wake of media reports on amendments to the Consumer Credit Act and the Credit Institutions Act. He said one of the first measures in the programme was to regulate citizens' obligations towards the state by adopting a law that enabled the rescheduling of those liabilities.
The Finance Ministry has posted on its website a document according to which no bank would be allowed to seize someone's entire salary, regardless of what citizens have signed, Linic said, adding that one third of a salary or a pension must always be left in the account.
In this way, we have stopped citizens from signing all sorts of things and banks from abusing this, he said.
Talks on consumer loans have also been launched to prevent "enormous interest rates on housing loans", with the central bank and the ministry reaching a compromise under which the finance minister can limit interest rate growth, Linic said.
The government also wants to monitor interest rates on consumer loans and put an end to the most expensive credit, overdrafts, which should not exceed the amount of one monthly salary and not three, as is the case now, Linic said.
Everything else should be transferred to consumer credits, where the interest is at least three per cent lower than on overdrafts, he added.
Linic dismissed claims "that this is another blow to citizens," saying that these measures were actually to citizens' benefit, as they would pay lower interest on consumer loans.
Linic also said the legislative amendments envisaged that interest on housing loans would not grow "as banks arrange or assess" but would be controlled by the government.
(Hina)




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