ECRC Stakeholder Parliament: 44 Questions and 44 answers on Responsible Credit by the Participants of the ECRC Brussels Conference 2007. Results: Strengthening of ECRC, Overindebtedness a major concern, credit card regulation and scores that one can attack. Not much believe in mere transparency but more regulatory efforts. EU is seen critical and practices of Payment Protection Insurance or Sale of Loans should be regulated. ECRC tried out an electronic voting device during its Brussels conference. During plenary discussion at three occasions participants saw questions at the screen which they could answer by pressing a digit between one and ten. To facilitate a later more thorough evaluation all had to answer questions about themselves first at all three occasions so that later on differences between the groups and their opinions could be identified. The number of voters were highest first day and decreased the second day. But the overall picture may be interesting. One should keep in mind that the following results represent all stakeholders including the supplier side and science. We will later on make an extra evaluation for the three major social activist groups. Annexed you find the exact data graphically displaced in a power point presentation. Here are some of the results. WHO PARTICPATED? About 113 of the 178 participants at the Brussels conference participated in the first day’s electronic voting. It showed that most people came from the EU where France, UK, and Belgium dominated. Half were under and half over 40 years of age. Women and men were just half and half. While consumer organisations made up for 12%, social organisations for 18% and money and debt advice organisations for 11%, the supplier side accounted for 17% and science and research for 15% of the participants. 19% represented partners of the coalition, 13% conference sponsors while 50% defined themselves as interested. OVERINDEBTEDNESS Most people (67%) thought that their country was not effective in preventing overindebtedness which they attributed to changes in borrower circumstances after credit (45%) or irresponsible lending (32%). Borrowers and lenders responsibility were seen unevenly distributed (67%). How to cope with overindebtedness only 8% thought that limiting access to credit would help. 32% thought that lenders should be obliged to ensure more suitable products and 26% wanted legislation to prohibit irresponsible lending. Direct state lending to low income borrowers got as much votes as microfinance (22%) while disclosure of bank behaviour like under the CRA Act was the most favoured approach (24%) Only 9% wanted to leave low income borrowing to the market. PREDATORY LENDING More than 80% of all participants agreed that predatory lending was a problem that needed at least concern. Legislation was seen as the weakest tool (46%) next was financial education (30%). Would the most favoured approach in consumer protection more transparency truly help? Yes for 45%, no for 44%. DEBT ADVICE 35% thought that there country provided access to debt advice. 81% demanded some form of support for debt advice by the industry. The next voting took place on Saturday at noon. CONSUMER BANRKUTPCY While 41% assumed that bankruptcy procedures let to rehabilitation and 14% voted for exclusion most 46% were indifferent. PAYMENT PROTECTION INSURANCE 21% wanted to forbid all or some form of payment protection insurance, 44% agreed that more than one product should be offered (total 56%), that insurance cost should be disclosed in the APRC (total 51%) and in total 53% aksed for full disclosure of kick-back provisions to the bank. Only 7% saw no need for action. SALE OF NON PERFORMING LOANS Most people (61%) wanted a general interdiction of sales of loans without consent of the consumer while another 21% favoured this for performing loans. Another 13% wanted to let credit contracts be sold only if servicing remains with the original supplier, while only 3% saw no need for regulation. EU-DIRECTIVES EU regulation is not very popular with stakeholders. 29% assumed that the pending directives were bad for low income consumers. 21% even thought they were bad for all consumers while 16% thought they were superfluous. But 26% had a good opinion of the Directives. SCORING 71% pleaded for an unsolicited disclosure at an credit application. 36% thought that consumer should have a right to attack their scores and another 36% wanted the suppliers to disclose in each case how consumer could improve their scores. LOANS TO POOR PEOPLE There was not visible preference for a special type of bank. Each type had its fans. But asked what the most important thing for lending to the poor should be half of the voters pointed to professionalism and half to low interest rates while social mindedness or non-for-profit or being small got no votes at all. CREDIT CARD CREDIT Credit card credit will definitely increase overindebtedness. This is the opinion of all participants. While half think this is because they loose track with the amount they owe the other half believes that credit card make credit irresistible. Again half agreed that credit card credit should only be extended by supervised banks while the other 50% favoured a virtual bank account in which all credit card debt should be consolidated. THE CONFERENCE People and the quality of the discussions these are the two options which good equal votes. Compared with other similar events the conference was outstanding (24%) or good (61%), average (3%) or needs improvement (13%). It increased knowledge (69%) at first place, public awareness for responsible credit (54%), improved NGO cooperation (57%) and it should be repeated every year alternating between Brussels and other cities (63%) while 22% thought every second year would be sufficient. PRINCIPLES OF RESPONSIBLE CREDIT The seven principles of responsible credit were ranked and their order reversed. While access (No.1) remained on the first place (33%), responsibility and fairness at all times of the credit (No 3) got second (24%) while a concern for overindebtedness (No. 6) arrived third (18%) followed by effective protective legislation (12%) while transparency (No 2) only scored for 9%. The principles are seen as most efficient directly on the market for bank behaviour (40%) just as much as law and organised action. ECRC All participants agreed to support ECRC in one or the other way. 89% pleaded to expand to a global discussion including to other continents (93%) ID: 40289 Author(s): UR Publication date: 24/09/07     ECRC Stakeholder Parliament: 44 Questions and 44 answers on Responsible Credit by the Participants of the ECRC Brussels Conference 2007. Results: Strengthening of ECRC, Overindebtedness a major concer 44 Questions and Answers on Responsible Credít (353981 Bytes)

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