Consumer Credit Act 1995

The Consumer Credit Act 1995 is a pivotal piece of legislation in Ireland that regulates credit agreements. It ensures transparency and fairness in the credit market, protecting consumers from unfair lending practices.

Overview of Consumer Credit Act 1995

Purpose of the Act

• Definition: Established to regulate credit agreements and protect consumers.
• Example: Ensuring that all terms and conditions of a credit agreement are clearly stated and understood.

Key Provisions

• Cooling-Off Period: Allows consumers to withdraw from credit agreements within a certain period.
• Full Disclosure: Lenders must provide complete information about interest rates and total amount payable.
• Credit Advertising: Regulates how credit products can be advertised, prohibiting misleading advertisements.
• Licensing of Credit Institutions: Requires lenders to be licensed, ensuring they adhere to statutory requirements.

Detailed Explanation of the Act

1. Regulation of Consumer Credit Agreements

• Scope: Applies to agreements where credit is provided to individuals.
• Requirements: Includes detailed information on repayments, interest rates, and total cost of credit.

2. Licensing and Regulation of Credit Institutions

• Licensing: Credit institutions must obtain a licence from the regulatory authority.
• Compliance: Ensures adherence to ethical lending practices.

3. Consumer Rights and Protections

• Right to Information: Consumers must be informed about the terms of credit and any associated costs.
• Protection from Unfair Practices: Safeguards against high-pressure selling and unfair credit terms.

4. Advertising Standards

• Regulation: Advertisements for credit must not be misleading and must present clear information.
• Transparency: Requires disclosure of APR (Annual Percentage Rate) in credit advertisements.

5. Enforcement and Penalties

• Enforcement Bodies: Central Bank of Ireland and Consumer Protection Commission.
• Penalties: For non-compliance, including fines and licence revocation.