Dáil Éireann Debate, Tuesday - 23 June 2015
258. Deputy Michael McGrath asked the Minister for Finance when a revised Central Bank of Ireland code of conduct for financial institutions, in respect of dealing with small and medium enterprise debt, will be published; and if he will make a statement on the matter. [24990/15]
View answerThe Code of Conduct for Business Lending to Small and Medium Enterprises (SME Code) was introduced in 2009 and sets out important protections for SMEs when they are accessing credit or in financial difficulties. A limited review was carried out in 2011 focussing on the 'Financial Difficulties' provisions, with new and amended provisions introduced with effect from 1 January 2012.
On 11 January, the Central Bank published a consultation paper on the review of the SME Code which included a set of draft regulations.
The consultation paper proposed additional and enhanced protections to further strengthen the existing SME Code, including requirements for lenders to:
- provide information on the application process and associated timelines;
- assess affordability;
- provide reasons in writing for declining credit that are specific to the application (or part thereof) that was declined;
- provide increased information to borrowers about their policies for dealing with financial difficulties, including the implications for borrowers of not co-operating;
- provide detailed information to borrowers in financial difficulties about an offer of an alternative arrangement;
- expand the appeals provisions to include decisions on declining or withdrawing credit and decisions regarding terms and conditions; and
- provide information to the customer about:
- Government supports available from or through the lender;
- the lender's appeals process and the role of the Credit Review Office (where relevant); and
- the complaints process including, where relevant, to the Financial Services Ombudsman (FSO).
The closing date for responses to the consultation paper was 13 April 2015. I am informed by the Central Bank that the responses are currently being reviewed and revisions to the draft regulations are being considered with a view to publication of the regulations by the end of the year in accordance with the Bank's 2013-2015 Strategic Plan.
