THe Regulation on Amendment to the Regulation on Consumer Credit Contracts was published in the official gazette on 23.09.2022.
With the amendments to the Regulation on Consumer Credit Contracts ("Regulation"), obligations have been introduced to reduce the power and information asymmetry between financial institutions and consumers and to ensure that consumers act consciously in the contract establishment processes. In this context, the law has defined "ancillary financial products and services". Also, especially in the processes related to insurance contracts offered together with loan contracts, new information that the financial institution must provide to the consumer has been defined.
Accordingly, with the amendment to Article 6 of the Regulation, a number of additions have been made to the information that the creditor and the credit intermediary, if any, must include when informing the consumer about the terms of the contract, including the information in the regulation. With this amendment, it has been decided to include information on,
• In case of insured and uninsured loan offers, sample payment plans for both offers, if the instalment amounts of the loan are equal, comparative information on the instalment amount and total repayment amount instead of the sample payment plan, • In case of insured and uninsured loan offers, the name and duration of the loan-related insurances and whether they are renewable or not, in the notifications provided to the consumers.
In addition, with the 4th paragraph added to Article 6 of the Regulation, in order for the creditor to be able to offer a credit contract that includes credit-related insurance to the consumer, it has been made obligatory for the creditor to prepare the Consumer Credit Preference Form in Annex-6 of the Regulation together with the pre-contractual information form in at least fourteen-point size, including the consumer's preference and approval regarding the insurance, and to provide a copy of it to the consumer on paper or via a permanent data storage device.
With the amendments to Article 26 of the Regulation titled "Obtaining Insurance", it was regulated that,
• Credit-linked insurance may not be taken out without the explicit request of the consumer in writing or through a permanent data storage device, and the creditor may offer a credit contract that includes credit-linked insurance to the consumer, provided that the creditor also offers the consumer an contract that does not include credit-linked insurance,
• The insurance policy provided by the consumer from the insurance company of his/her choice, compatible with the amount and duration of the loan, with the lender as the principal beneficiary, must be accepted by the lender without causing any change in the conditions of the loan offered to the consumer,
• Credit-linked insurance should be compatible with the amount and maturity of the outstanding debt in the sum insurances, in order guarantee the repayment of the loan debt,
• Credit-related insurance must be compatible with the subject of the loan, and
• More than one insurance covering the same collateral cannot be taken out for the loan and it is prohibited to take out insurance exceeding the loan amount.
Along with the Regulation Amending the Regulation on Consumer Credit Contracts, it was stated that the amendments made in Article 6 and Article 11 will enter into force on 01.01.2023 and the other amendments will enter into force on 01.10.2022.
You may access the regulation via this link.