The main purpose of this Bill is to restrict the total cost of credit on moneylending loans.
The Bill will restrict interest rates by providing the Minister for Finance with the power to make regulations setting the maximum interest rate at which a moneylending loan can be provided, and by prohibiting moneylenders from charging for home collection services.
The Bill also contains a range of measures to modernise and streamline the sector, including:
- Allowing repayment books to be maintained online;
- Allowing licenses to be issued for periods of five years at a time rather than one;
- Removing the requirement for moneylenders to register for a particular District Court area, and register State-wide instead; and
- Changing the term ‘licensed moneylender’ to ‘high cost credit provider’ to differentiate between licensed and unlicensed moneylenders.
The legislation follows a comprehensive review of the moneylending sector undertaken by the Department of Finance and the proposals take into account the submissions received during the public consultation held by the Department in respect of the issue. Minister Donohoe published a Moneylending Policy Proposals Report on reform of the moneylending sector in July 2021.
Speaking today, the Minister said: ‘This Bill will reduce the cost of credit for the customers of moneylenders. The legislation also introduces a range of measures to reform and modernise the moneylending sector. These measures will provide better protection for consumers and will streamline the licensing process for providers.’
