Parliamentary majority for tightening of high-cost credits
We at GoodIn Finance have repeatedly written that the regulatory framework for high-cost credits, such as sms loans, will probably be tightened on September 1, 2018. The government added a report on this quite a long time ago and last fall (2016) when it was finalized. that a number of measures would be introduced, measures that would stifle the high-cost credit market. You can see how the proposals look in our article on how to sharpen the fast-loan industry.
But it is true that our current government does not have its own majority in Parliament, so of course more parties must support the proposal for it to be pushed through. Therefore, it is extra interesting to see what the other parliamentary parties think of the proposal for high-cost credits.
What do parliamentary parties think about the proposal?
Now, we will briefly show you what the parliamentary parties think of the investigation proposal, which will probably be converted into a bill fairly soon. It gives a hint as to whether the proportion will be pushed through in Parliament or not.
The government – yes to the proposal of course
The government, that is, the Social Democrats and the Environment Party, were from the beginning interested in tightening the rules for high-cost credits, which is why they wanted an investigation into this. And when the investigative team came up with their proposals for action, they seemed positive to the proposals, so obviously the government will put a bill on this.
The Left Party – yes, but want to tighten the rules further
In the 2017/18: 3598 (Consumer Rights) motion filed by Lita Johansen and others, the Left Party is clear that they will give their full support for the new regulations. However, they believe that the measures are not sufficient but should be further tightened further because “the Left Party wants to remove the fast loans completely from the market” and wants the government to “submit a proposal as soon as possible which prohibits sms loans and other fast loans “. Furthermore, they write that “Sweden coped just fine before 2006 without this type of loan” (despite the fact that more people had debts with Kronofogden before the sms loans came to Sweden).
The Moderates – yes, but maybe not to the whole bill
Moderate Eva Lenk and others shows in its motion 2017/18: 3213 that the Moderates also believe that there are shortcomings in the fast-loan industry but are not quite as critical as the government and the Left Party. They believe that high-cost loans make up only a very small part of today’s consumer loans and only make up 1% of all loans today (and if you only look at the loan amount, the loans are only 0.16% of the loan burden in Sweden according to the Swedish Financial Supervisory Authority’s statistics, our note). Thus, there are other bigger problems than just high-cost credits.
On the whole, the Moderates fully agree with the notes on the interest rate and cost cap and agree that the credit tests must be tightened. However, they want only one authority to have control of the credit companies instead of two as today (Moneyquest Finance and the Consumer Agency), which they consider to be more effective. They suggest that only Moneyquest Finance should take care of this. Probably, the Moderates will also vote in favor of the government’s bill, at least with regard to certain parts of it.
The Liberals – want to see the bill first
In the documents ahead of the Liberals’ national meeting 17 – 19 November 2017, it can be seen that the Liberals are also critical of loans and believe that careless credit should be met. On the other hand, they are not very clear about how they want to tackle the problem and write that they want to wait for the government’s proposal before taking a position on the individual proposals.
Center Party – a resounding yes?
There is no doubt that the Center Party will vote in favor of the government’s bill. In the motion Consumer in the center 2017/18: 3756 they write that “the investigation Strengthened consumer protection in the market has come up with a number of interesting proposals and must now be urgently addressed by the government”. Much clearer than that, we can’t think of that.