Danish Credit Agreement Act
With regard to the right of withdrawal, the amount of credit is generally used and the consumer remains bound by a sales contract.B. Under the right of withdrawal, the consumer is required to act responsibly after the fact, even if he may have acted irresponsibly in the contractual situation. If the requirement for pre-contract disclosure on the right of withdrawal exists without any indication of the costs associated with the use of the right for a consumer, this may contribute to consumers borrowing on the basis of the idea that they have a free credit facility within 14 days for which the right of withdrawal applies. Early repayment seems irrelevant in the context of SMS loans because of their short duration. However, before considering the introduction of maximum costs, it seems appropriate to strengthen the ability of courts to cancel abusive credit contracts pursuant to these provisions, including Section 22 of the Credit Agreement Act and Section 36 of the Contracts Act. In addition, the introduction of a single credit standard as a separate provision would limit the need to set the maximum cost of credit, even if the two measures are not mutually exclusive. Responsible loans in themselves include unpaid loans, i.e. for which repayment consists exclusively of the loan amount. Such a credit can (also) represent a financial burden on the borrower. A maximum price does not have this advantage.
Efforts to create a single European consumer credit market under the Consumer Credit Directive (CCD) and to achieve consumer protection for this purpose are rarely extended to SMS lending. Beyond the scope of CCD 1987 and CCD 2008, credits, small credits, short-term loans and zero-rate credits include, among others; See Article 2, subsections 2 c) and 2, point f). Such an exception also applied to the scope of Section 3 of the Danish Consumer Credit Act, as it was in force before 2010. This Act does not apply to credit contracts for which the credit is granted interest- and interest-free, or for which the credit must be repaid within three months and the costs are negligible; See section 3 (1). Therefore, Danish courts cannot maintain the choice of a right other than Danish law that regulates non-contractual obligations. B of a loan agreement. Similarly, it is not known to what extent the Danish courts will enforce a foreign bankruptcy decision concerning the debtor`s Danish assets. At the end of 2013, consumer credit for companies that do not accept deposits amounted to DKK 21 billion (2.81 billion euros). Of these loans, 41.2% were unsecured loans, 40.9% were fee and credit cards, and 17.9% were secured loans. These loans amounted “only” to 14B (1.88B) ten years ago.
Expensive SMS and web loans fall into the category of unsecured debt, which has also increased over the past ten years, from 5.1 B DKK to 8.7B (0.68B to 1.17B).