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Consumer in Trouble - Rights and Advice to Debtors in Default
Financial Services extend together with modern market economy. They provide mighty tools for private investment and ameloiration of living conditions. But it is also a hazardous good that threatens the social and economic well being of people who lose their steady income or have to endure hardship like illness, accidents or family beakdowns.

Market economy alone is not able to cope with these problems. The consumer is in a far too weak position to offer enough bargaining power first to create adequate contracts and second to adjust these contracs to his or her living conditions. Financial services industry is tempted to maximise profit even to the detriment of their own market on the long run. The state by its leagal means has the obligation to embed this market into rules of transparency and information for those consumers who still could exercise their choice if they would only be skilled emnough to understand the thousands of variations inherent to such compley produucts like consumer credit forms. But furthermore the state has to offer social protection in order to force creditors into socially responsible behavoir in situations where consumers have little or no choice at all.

But all kind of consumer rights as well as consumer advice especially for overindebted consumers who are in default has to cope with the problem that protection will also stigmatise these consumers, make them more costly customers of the banking system and tend to exclude them if not additional measures are taken.

Therefore the triangle of informational, soial and collective consumer protection has to provide for what I called inclusive instead of exclusive consumer protection for the lower classes of society.

ID: 17270
Author(s): Reifner, Udo
Publication date: 19/10/99

Created: 19/11/99. Last changed: 14/03/06.
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