Local view for "http://purl.org/linkedpolitics/eu/plenary/2008-01-15-Speech-2-061"
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"en.20080115.7.2-061"2
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"Mr President, the vote in this House on Wednesday on the Consumer Credit Directive is a very important moment for Europe’s 500 million consumers.
Concerning pre-contractual information: information given to consumers for credit offers will be presented in the same standard credit information form across the EU, and it will give all the key facts and figures – from interest rates to information on charges and linked insurances. This will allow consumers to make a direct comparison between different offers presented in a standard, comparable way.
The Directive also sets out two essential rights for consumers. Once they have concluded the credit contract, consumers will be able to withdraw from the credit without having to give any reason and without any charge. This right, a new feature in almost half of the Member States, will apply to all consumer credits in the European Union.
In addition, the Consumer Credit Directive confirms the consumer’s right to switch, and this must be a very stable policy line – not only in this area. The right to switch with the right to repay early at any time: this is a critically important issue for the Commission, to ensure fair compensation to banks and at the same time to safeguard the consumer’s right to make a free choice and to proceed to a more competitive offer on the market. This is essential if competition is to thrive.
I fully recognise that harmonising legislation in this very sensitive area is not an easy task, but I am convinced that markets are made by people and should be made to work for people, and I believe that we in Europe are in the business of putting people at the centre of the market, giving people the power to chose, giving businesses the power to compete, and getting the European market to work for consumers.
I want to emphasise that, in the modern world, it is not about pitching consumers against business, but building healthy markets where consumers can choose and businesses can compete.
I believe that the amendments put forward by the PSE and the ALDE Groups – with which the Council has agreed – constitute a fair and reasonable compromise.
In my opinion, this is the best option in the interests of both consumers and financial services providers. I believe that the vote for this compromise package is a vote in favour of competitive markets, clear information and more informed consumer choice.
It is a modest beginning in the consumer dimension of financial services, where much needs to be done. So I look to the Members of this House: you are the ones to speak directly, on behalf of European citizens; you have fought, for so many years, for the things that really matter to people in their daily lives.
The task is to vote to support an agreement today on credit rules that will provide real added value to Europe’s citizens in that space where they lead their lives and to send a clear signal of Europe’s willingness to roll up our sleeves and work in an area that greatly concerns our citizens and businesses, large and small, today.
It will directly affect many people’s lives, and it is about two critically important issues. The first is about consumers being able to make better-informed choices when they take out credit loans: to pay for a family wedding, a washing machine or a new car – the things of life.
Second, it is about consumers getting more choice and a more competitive market. It is also a very important vote for businesses, creating a single, simple framework of rules so banks and other creditors can do business more easily across borders.
We need to seize this opportunity to move forward. It is clear that the status quo is not working. The figures speak for themselves. In Europe the average consumer credit interest rate varies from around 6% in Finland, the cheapest Member State, to over 12% in Portugal. In Italy, credit rates are about 9.4%, in Ireland about 6.8%.
Europe’s consumer credit market is fragmented, broken down into 27 ‘mini markets’. And, in a European credit market worth EUR 800 billion, direct cross-border financial services make up only a tiny fraction – 1% – of all distance credit transactions.
Clearly, the internal market is not functioning. Clearly, competition at EU level is not functioning. The result is that consumers are being denied choice and more competitive offers, and competitive businesses are being denied opportunities to access new markets.
The Consumer Credit Directive is necessary to start to break open the potential of the internal market and boost competition and choice. There are two main aims of the Consumer Credit Directive: to provide standards – comparable information – to consumers to make informed choices, and to give businesses a single set of standards to sell competitive credit offers across borders.
The Consumer Credit Directive focuses on transparency and consumer rights. I will highlight just a few of the important common elements it puts in place. Concerning advertising for credit loans: if there is a figure in an advertisement on credit, it will be mandatory to provide the same standard list of essential information all over the European Union.
Most importantly, for the first time, the annual percentage rate of charges will be calculated in the same way across the European Union. This is a very significant step forward, so that consumers can see the real cost of credit using one single figure."@en1
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