Dáil Éireann Debate, Wednesday - 27 October 2010
192 Deputy Seán Sherlock asked the Minister for Finance if his attention has been drawn to the fact that the country’s largest licensed home collection moneylender has acquired an additional 13,000 customers in the past year; his plans to introduce a system of regulation for debt collection agencies [38637/10]
Amharc ar fhreagraIn my role as Minister for Finance I have responsibility for the development of the legal framework governing the regulation of financial institutions in Ireland. The day to day responsibility for the supervision of these financial institutions is a matter for the Central Bank which is independent in the exercise of its regulatory functions. The Central Bank issues licences to moneylenders on a yearly basis. The Central Bank has produced a Consumer Protection Code for Licensed Moneylenders . Under this Code, moneylenders are required to prominently indicate the high-cost nature of the loan on all loan documentation where the APR is 23% or higher. The disclosure must take the following form:
Warning: This is a high-cost loan.
Moneylenders must also provide consumers, who demonstrate difficulty in meeting their repayments, with information on debt counselling services such as the Money Advice and Budgeting Service which provides free independent advice and guidance.
Other provisions of the Code cover a range of areas including:
Unsolicited contact and unsolicited credit facilities,
Handling complaints,
Arrears and guarantees, and
Debt collection.
The Non-Fatal Offences against the Person Act 1997 provides some protection to consumers against inappropriate methods of collecting repayments. Under section 11 of that Act, it is an offence to demand payment of a debt in a way designed to alarm, distress or humiliate. Statutory responsibility in relation to the provisions of that Act rests with my colleague, the Minister for Justice and Law Reform.
The Deputy may wish to note that, in the case of financial institutions which use debt collection firms, the Central Bank has imposed requirements, under its Consumer Protection Code, that offer protection to consumers. This Code obliges the regulated financial institutions that it covers to ensure that any outsourced collection activity complies with the requirements of the Code. This means that outsourced activity should uphold principles in the Code such as the requirement for institutions to:
not exert undue pressure or undue influence on a customer,
act honestly, fairly and professionally and with due skill and diligence in the best interests of its customers, and
prohibit personal visits to or oral communications with consumers except in specified circumstances.
The Deputy may also wish to note that the National Consumer Agency provides extensive information on its website and through its helpline to help consumers avoid getting into debt difficulties. The Agency also provides information for those at risk of not being able to meet loan repayments.
