Written answers

Tuesday, 10 February 2015

Department of Finance

Consumer Protection

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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242. To ask the Minister for Finance if his attention has been drawn to the concerns that while hire purchase agreements have been regulated under Irish law since 1946, the providers of such agreements and the general activity is not regulated, and as a result, the consumer is placed in an invidious position; and if he will make a statement on the matter. [6139/15]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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Both the Central Bank and the Competition and Consumer Protection Commission (CCPC) (formerly the National Consumer Agency) have certain functions and legal powers in relation to the provision of hire-purchase agreements.

The CCPC has specific responsibility for the authorisation of credit intermediaries under the terms of the Consumer Credit Act 1995. This includes those who act as an agent for undertakings providing hire purchase agreements. The Competition and Consumer Protection Commission further regulates the advertising of credit facilities by authorised credit intermediaries. To obtain an authorisation, the intermediary must hold a letter of recognition for each undertaking for which he is an intermediary, a current tax clearance certificate, and be a fit an proper person to carry on the business of a credit intermediary. All credit intermediaries must display an authorised copy of their authorisation prominently in their premises and they appear in the CCPC's online register.

There are no legislative requirements that oblige hire purchase providers to seek an authorisation from the Central Bank for the provision of hire purchase agreements to consumers and or to small businesses. Notwithstanding this, hire purchase providers are required to comply with the relevant provisions of the Consumer Credit Act 1995 when providing hire purchase agreements to consumers acting outside their business. Research is currently being carried out on behalf of the Central Bank in order to obtain information on the hire-purchase market, such as information about the number and identities of firms providing hire purchase agreements, the purpose and features of the agreements, the level of commitment by the consumer, the level of arrears and default, and the level and type of complaints.

In the case of small and medium enterprises, where hire purchase is provided by a bank under its banking license, the bank is required to comply with the Central Bank s Code of Conduct for Business Lending to Small and Medium Enterprises.

The remit of the Financial Services Ombudsman includes complaints in relation to the providers of hire purchase agreements under Regulation 2 of the Central Bank Act 1942 (Financial Services Ombudsman) Regulations 2005 (SI 191 of 2005). The Financial Services Ombudsman is a statutory officer who deals independently with complaints from consumers about their individual dealings with financial service providers that have not been resolved by the providers after they have been through the internal complaints resolution systems of the providers.

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