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Finmin says overdrafts must be regulated by credit arrangements

Autor: half
BRUSSELS, March 5 (Hina) - A current account overdraft exceeding one monthly salary cannot be a unilateral act by a bank but be regulated by a credit arrangement between a bank and a consumer, Croatian Finance Minister Slavko Linic said in Brussels on Tuesday.

"Our proposal is that the overdraft in citizens' current accounts should be reduced to a month's salary over the next year and that everything else should be regulated with a banking contract. Banks unilaterally decide whose overdrafts will be reduced or increased and we believe this mustn't be a unilateral act but an agreement," Linic told reporters.

He said he would insist that everything exceeding a monthly salary be regulated with a consumer credit arrangement between banks and citizens, with defined payment deadlines and payment instalments.

He voiced hope that parliament would pass his proposal.

Linic also said that his ministry was trying to see with banks and the central bank if interest rates on housing loans could be limited.

In February, the Finance Ministry announced that amendments to the law on consumer credits envisage reducing a current account overdraft to a monthly wage to stop citizens from borrowing expensively, and the possibility that the finance minister regulate the highest interest rate on housing loans to protect citizens.

Linic was in Brussels to attend a meeting of European Union finances ministers as an observer.

(Hina) ha

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