Poland’s competition Authority finds that the company imposed fees in a way that may be unlawful, while the company agrees to cease the practice.

Poland’s Office of Competition and Consumer Protection (UOKiK) regularly monitors the non-bank loans market. Illegal practices employed by undertakings in this industry include misleading advertising, making it difficult for consumers to withdraw from contracts, failing to meet information requirements and charging exorbitant fees. The decision on Provident’s practices is one result of the Authority’s activities.

UOKiK has found that Provident imposed fees in a manner that might infringe consumer interests. Among other issues, the Authority’s proceeding concluded that the company’s charges differ for loan services carried out at customers’ homes (whereby money is picked up at the client’s residence), despite the charges having been established for the same amount of installments. In fact, the amount of the fees for the at-home service was based on the amount of the loan, not the value of the service. Provident employed a similar criterium for calculating preparation charges. In the opinion of UOKiK, the company may have violated the law, because charging for a service should be correlated with the costs that the firm actually bears. To address the Authority’s findings, Provident has committed to change its practices by implementing a flat-rate fee for services, including home visits under contract, by no later than 1 August, 2015.

Legislation is currently being worked on to increase consumer safety on the non-bank financial services market. Last week, the Council of Ministers adopted a draft amendment to the laws on financial supervision, banking law and other acts. The legislation proposes limiting the non-interest costs of consumer credit, the introduction of a limit on penalty interest and interest on interest as well as determining the requirements for companies providing consumer credit. The bill is now being debated by the government and will then be sent to parliament.

Additional information for the media:

Press Office, UOKiK
Pl. Powstańców Warszawy 1, 00-950 Warsaw
Phone.: +48 22 827 28 92, +48 22 55 60 314, +48 22 55 60 430
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]