Insider Business Overcharging by banks in Cyprus spark fresh reaction

Overcharging by banks in Cyprus spark fresh reaction

Excessive interest rate charges by banks in Cyprus have sparked fresh reaction from unions and other organised groups who are taking the matter before parliament.

At the same time, right-wing SEK trade union is accusing the Central Bank of Cyprus and the Competition Protection Commission of being ‘suspiciously silent’ over this alarming issue.

And ruling Disy MP Marios Mavrides is making moves to amend the Liberalisation of Interest Rates and Related Matters Law of 1999 so as to stipulate that penalty interest is imposed only on over-due instalments even after a loan is terminated.

Mavrides also wants the law to stipulate that a credit institution will be burdened with the task of proving that the imposed penalty interest represents its actual loss.

“The biggest problem concerns contracts signed before September 2014, for which there is no limit on penalty interest rates…What stands before a court today is the interest rate the bank ‘indicates’ to a judge who accepts it without much questioning  since there is no defence for the borrower,” Mavrides told Phileleftheros.

Mavrides also said that in many cases interest rates on late payments amount between 7% to 8%, and a terminated loan is charged between 12% and 14% (normal interest rate plus late payment interest rate).

The only response by the Association of Cyprus Banks was that after the matter is presented in detail before Parliament and after they get to review it thoroughly, then the Association will take a stand as well as  send representatives to give clarifications, if necessary, to deputies.

In the meantime, SEK has submitted a written request to both the CBC and the CPC calling them to exercise their influence in a bid to have a series of bank charges deemed unacceptable removed from the island’s banking system.

The union explained that these overcharges mainly affect vulnerable population groups such as low-income pensioners and people living below the poverty line.

 

Read more:

https://in-cyprus.com/higher-bank-charges-in-view-of-the-promotion-of-e-banking/

Top Stories

36 new coronavirus cases detected out of 3,317 tests

The Ministry of Health has announced that 36 new cases of the SARS-CoV-II virus were detected in Cyprus over the past 24 hours out...

Emergency meeting regarding mass coronavirus cases detected in football teams to be held at Ministry of Health on Thursday

The Cypriot football scene is officially on alert. Positive coronavirus cases seem to be sprouting left, right, centre and generally multiplying before one can...

Ethnikos Achnas FC: number of now confirmed COVID-19 cases skyrockets to 17

Fears of a sharp increase in positive coronavirus cases in Ethnikos Achnas have been confirmed. As confirmed by an announcement by the team, a total...

Ethnikos Achnas FC: covid cases reportedly now in the double digits – match with Aris Lemesou postponed

Information about several positive cases of coronavirus detected in Ethnikos Achnas FC has been confirmed. The latest information indicates that the second diagnostic test the...

Additional covid measures in Larnaca effective immediate starting Thursday

The Government has announced new local measures concerning the coronavirus pandemic due to the outbreak observed in Larnaca the past few days. The Minister of...

Taste

Spicy grilled soutzoukakia

Place all ingredients for soutzoukakia in a bowl and mix well, preferably using a food processor, until well combined. Using the mixture, form cigar-shaped...

Souvlakia

Pork souvlaki: Put the meat and all the other ingredients in a bowl (not metal) and mix well. Cover the bowl and keep in...

Pastelli (Carob Toffee)

The nutritional sweet of Pastelli is made with the syrup of carob pods, produced by boiling their pulp until it forms a thick, sticky...

Meatballs with tomato and cumin

Place all meatball ingredients in a bowl and knead well with hands. Keep the mixture in the fridge for approximately 1 hour to thicken. In...