EU – Baltic States, Financial Services, Latvia, Loan

Freeman has spent several days in Latvia and had meetings with the CRPC representatives.

Commenting the current situation in Latvia, Freeman points out that Latvia could benefit from several measures it can introduce. One of the steps he suggests is to introduce a comprehensive system of licensing in the crediting sector, which would apply to the providers of consumer loans as well as mortgage loans. The supervising authority should be given enough power to be able to adjust market players' actions through imposing certain requirements on the loan providers, writes LETA.

Latvia will have to introduce the licensing system anyway when the EU Consumer Credit Directive comes into force.

Another useful measure could be to introduce a consumer protection code for credit institutions, which could be either compulsory or voluntary.

Freeman emphasizes that the above-mentioned directive could form a good framework for the code as it will regulate advertising of loans, information to be given prior to signing a loan agreement, as well as conditions of loan repayment.

Freeman also explains that it would be useful to expand the legal regulations on loans.

While the EU Consumer Credit Directive has not yet come into force, the CRPC should have more rights to intervene and issue regulations that would be binding to loan providers, the British expert believes.