Payday Loan Do Not Plan to Eliminate, But the Measures Need to Tighten

At the next meeting of representatives of our state considered issues related to consumer protection. The issues of today and those that may arise in the near future have been thoroughly discussed.

The head of government pointed out that the most shortcomings are present in the service sector. Payday Loans, as a type of financial services, are no exception. Despite the tough measures taken by the regulator towards microloans, users of this service have a fairly large number of questions and complaints.
The President also pointed out that “microloans before wages” were legally allowed on the financial market with an excessively high interest rate. In his opinion, this service, which in some circumstances can cost up to 600 rubles. a day should be cheaper.


Financial Illiteracy is the problem

The main problem of the Russian consumer of microfinance services is financial illiteracy. People often “peck” on special offers and promotions in the store and, without appreciating their strength, borrow money a lot more than they actually need. In addition to this, there are organizations that do not specifically interpret to their client all the nuances of using this service.

Financial Illiteracy is the problem

The President insisted that CBA Bank continue to work closely on regulating the microloan market. In addition to this, it is necessary to work on high-quality public awareness. Russians should be well aware of their financial situation and plan their income and expenses. And also, all financial products should be as transparent as possible and the conditions for them are clear to the consumer in advance.


The day after the meeting

A court order was promulgated in which it was approved to impose a fine on some Payday Loan for unilaterally changing the terms of the contract. The organization, without the borrower’s consent, changed the list of loan repayment types.

Representatives of many microcredit companies confirm that this practice is widespread due to the fact that the working conditions of many payment systems are changing. Payday Loans themselves cannot influence these conditions. In turn, representatives of the “payments” state that they have no right to terminate the contract with the organization unilaterally, if it does not violate the law or does not conduct questionable transactions.

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