No interest, or what?
As the name suggests, non-interest costs are all fees that we will incur in connection with the launch of an installment loan, payday loan or bank loan, but other than interest. These include commissions, margins, administrative fees, application fees, insurance fees, etc. In the loan sector, we have a new definition of the term. Since July 10, 2015, non-interest charges officially include fees that the borrower incurs in connection with his decision to use the home service option.
Non-interest costs in the light of the Anti-usury Act
With the lifting of restrictions on non-interest costs in 2011 (they could not exceed 5% of the loan or credit granted), financial institutions were given the green light to charge fees other than interest at any level. The lack of ranges in which the price of a financial liability should close, allows lenders to impose a number of additional fees on the client, and thus – to strongly increase the total cost of the loan. Changing the regulations has also become a water for a mill for dishonest companies, which, wanting to earn on contracts, often led customers to excessive debt. For this reason, non-interest costs have become the most important issue in creating the so-called the Anti-usury Act, which aims to cover the regulations of the unattended market for non-bank loans.
Non-interest expenses are again limited
The amendment to the Act on financial market supervision provides for a two-stage limit for non-interest costs. First of all, they cannot exceed 25 percent. basic amount. Secondly, they can reach a maximum of 30% per annum. loan value. In addition, the new provisions stipulate that together the customer may not be charged with costs greater than 100 percent. the value of the commitment received. Moreover, if the borrower has several loans within 120 days (he pays back one and incurs another one), non-interest costs will be calculated only on the first commitment. Considering that usually new customers can apply for relatively low amounts (in ViaTEXT it is 800 PLN, in Hillarium – 1000 PLN, in MetLoan and Loki – 1500 PLN, in Vivus – 1600 PLN), this solution should work in favor of consumers.