Wednesday, 18 July 2012

Questions (62)

John Paul Phelan


61 Deputy John Paul Phelan asked the Minister for Finance his plans to update the law governing the area of money-lending in view of the increase in the number of persons who are borrowing money at exaggerated interest rates; and if he will make a statement on the matter. [35492/12]

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Written answers (Question to Minister for Finance)

There is already a comprehensive licensing scheme in place for moneylenders. I would refer the Deputy to Part VIII of the consumer Credit Act 1995 (as amended) for detailed information in this regard. I have no plans to amend this legislation. Moneylenders have to apply to the Central Bank annually to have their licences renewed. Section 93 of the Act sets out the Central Bank's powers in relation to the grant or refusal of a moneylender's licence. I am advised by the Central Bank that the appropriate moneylending application form (new or renewal) must be completed and returned to the Bank with a number of items for review and consideration.

A Moneylender's licence granted by the Central Bank is specific to that moneylender, in that each individual moneylender's licence outlines the specific products that the moneylender offers, the APR for each product and the total cost of credit for each product. Before applying for a moneylender's licence, an applicant must give notice of this intention in a local or national newspaper, published in Ireland and circulating in the District Court area that the applicant intends to engage in the business of moneylending. The Central Bank may refuse to grant a moneylender's licence if, in the opinion of the Bank, the cost of the credit to be charged is excessive or, if any of the terms and conditions attaching thereto are unfair. This decision may be appealed to the Circuit Court.