Exclusions from the regulation of consumer credit
In particular, the scope of the consumer credit regulation excludes credit operations from:
- which are not subject to any interest or any fees or only interest and costs of a negligible amount
- and whose repayment term does not exceed 3 months.
But also the cards proposing a deferred debit not exceeding 40 days and, causing no other expenses than the contribution related to the profit of this means of payment.
Early repayment of depreciable credits
Early repayment of depreciable loans may be subject to an indemnity payable by the borrower, and is defined according to the following method of calculation:
- In the case where the remaining term is greater than one year, the lending institution may require 1% of the outstanding capital
- In the case where the remaining term is less than one year, the lender may require a maximum of 0.5% of the outstanding capital.
The absence of an early repayment indemnity (IRA) if:
- the early repayment was made in execution of an insurance contract to guarantee the balance of the credit
- the total refund is less than or equal to 10 000 € accumulated over 12 months
- if the prepayment occurs in a period where the borrowing rate is not fixed.
NB: When it comes to early repayment of revolving credit, there is never any compensation required by the lending bank or financial institution