National Council supports ban on advertising for small loans
For the first time, the National Council has endorsed a ban on advertising for small loans in order to mitigate the debt trap. The ban is intended to support efforts to prevent youth debt.
On Tuesday, the National Council passed a parliamentary initiative by Josiane Aubert (SP/VD) by 93 votes to 73, with a mandate to include a ban in the law. The majority was provided by the left, the almost united CVP and some parliamentarians on the right of the Council. Debt is not only a problem for private individuals, but also for the public, who often have to pay for private debts, Aubert said according to SDA. A ban on advertising would help to "tackle the root of the problem". 80 percent of young people in debt had accumulated their first debt before they were 25 years old.
It would be hypocritical to strengthen prevention while continuing to allow advertising for small loans, Aubert continued. Advertising would make young people believe that they could consume without restriction. However, young people need to learn that they can do without debt. Today, it is not even possible to enforce a ban at cantonal or municipal level. The city of Lausanne had been told off by the cantonal court of Vaud when it issued a ban on posters advertising small loans, as Aubert cited an example from her canton. The cantons would be slowed down in this way.
The large chamber decided against the will of its committee majority. Commission spokesman Hansjörg Walter (SVP/TG) admitted that the very intensive advertising was aimed primarily at younger consumers and that they often lived beyond their means. However, the default rate for small loans was low at 0.6 percent, Walter continued. In reality, however, things could be different: While the loans were being repaid, the debtors were no longer paying their taxes or health insurance premiums. However, the problem could not be solved by a general ban. Above all, the majority of the committee fears demarcation problems: "Would advertising for leasing offers still be permitted?" asked Walter. In addition, advertising contributes to transparency on the market.
However, the supporters made it clear that they wanted to set an example for the time being by calling for a ban on advertising. Lucrezia Meyer- Schatz (CVP/SG) said that Parliament still had to discuss the exact form this would take. The business will now go to the Council of States.









