Pearse Doherty (Donegal, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

47. To ask the Minister for Finance his plans for legislation to set a cap on the interest rate that can be charged by moneylenders; and if he will make a statement on the matter. [50883/17]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

As the Deputy will be aware, the Consumer Credit Act 1995, the legislation under which moneylenders are licensed, does not provide for an interest rate cap.  Nor do the European Communities (Consumer Credit Agreements) Regulations 2010.  Therefore, the Central Bank has no statutory power to impose a market wide cap on rates. Any legislative proposals in this regard would have to be careful to achieve an overall reduction in the cost of credit and ensure that it did not have unintended consequences in terms of financial exclusion.  

Under the Consumer Credit Act 1995, the Central Bank may refuse to grant a moneylenders licence if it is of the opinion that the cost of credit to be charged is excessive. The rates currently charged by licensed moneylenders have remained largely unchanged since the Central Bank took over the regulation of the sector from the Office of the Director of Consumer Affairs in 2003.  Since that time the Central Bank has not permitted any increase to the maximum APR charged within the sector nor has it licensed any moneylender to provide a ‘pay-day loan’ service such as exist in other jurisdictions. 

The Central Bank’s public register of licensed moneylenders is available on its website at and lists the maximum permitted APR and associated cost of credit permitted for each licensed moneylender.

The Deputy will be aware of the Personal Microcredit Scheme, which is providing simple microloans to credit union members and helping to combat the use of moneylenders.

I understand that 112 credit unions are now in a position to offer the ‘It Makes Sense Loan’ as they are fully set up to use the Household Budget Scheme operated by An Post.