New requirements for small loan advertising from 2016
From 2016, credit institutions will no longer be allowed to aggressively advertise small loans. This has been decided by Parliament. The aim is to better protect young people in particular from getting into debt. Advertising aimed specifically at young people is to be banned altogether.
The ban is provided for in a draft industry agreement drawn up by the Association of Swiss Credit Banks and Financing Institutions (VSKF) and the Leasing Association. The ban on aggressive advertising is only laid down as a principle in the law. The credit industry itself can define what is considered aggressive. According to the draft, it is prohibited to give consumers the impression that small loans are granted particularly quickly and without a detailed credit check. This excludes advertising with "express loans" or "instant cash".
It is also forbidden to advertise with arguments that are obviously not economically sensible. This includes, for example, taking out a small loan to reduce debts. Loans to finance vacations or parties may also not be advertised. With the agreement, the credit institutions also undertake to provide comprehensive information about the risks of small loans and to support further preventive measures. According to VSKF Managing Director Robert Simmen, the Federal Office of Justice has expressed its overall approval of the draft. Some points of criticism are still "being processed". However, Simmen emphasizes that approval by the Federal Office is not necessary.
The new rules will apply from next year. On Tuesday, the Federal Council decided to bring the amendment to the Consumer Credit Act passed by Parliament last March, on which the agreement is based, into force on January 1, 2016. The convention is to enter into force at the same time. The 14-day right of withdrawal for telephone sales will also apply from the beginning of next year. Parliament passed this amendment to the law last June after years of discussion.
Initially, the aim was to extend the current right of withdrawal for door-to-door sales to telephone sales. Then there was a long debate about a right of withdrawal for online purchases as well. However, this proved to be unacceptable to the majority. In the end, a minimum consensus was reached. Purchases under CHF 100 are excluded from the 14-day statutory right of withdrawal for telephone and doorstep sales. (SDA)
