Almost 200,000 people in Poland without access to credit every month

185,000 people a month will be deprived of access to credit, with those receiving finance having to accept smaller amounts and a much shorter repayment period. This will be the result of the entry into force of the so-called Anti-usury Act, according to a study conducted by the Analytical Department of CRIF Poland.

The act, introduced by the Ministry of Justice, will reduce lending costs but at the same time will force thousands of Poles to seek financing outside the regulated market.

"We looked at how lenders will adapt to the new regulations, and the conclusions are not good for customers. The study shows that after the entry into force of the so-called Anti-usury Act, the number of customers served by lending institutions will decrease by two-thirds compared to the number who receive loans under current terms," warned Piotr Badura, Vice President of the Management Board of CRIF Polska. "This means that people who can get a loan now will lose this option after the new regulations come into force. Our analysis shows that on a monthly basis the number of people whose loan applications are rejected will increase to 185,000 and it will be one of the biggest changes in the availability of financial services in recent years," added Piotr Badura.

In addition, those who do get a loan must prepare for the fact that it will be for a lower amount and for a shorter repayment period.

"The new costs of loans will force companies to provide financing for a shorter period, i.e., with a higher monthly installment, which may put more strain on household budgets. It will not be profitable for companies to offer installment credit to consumers," commented Agnieszka Wachnicka, President of the Financial Market Development Foundation.

What happens when consumers don’t have access to loans? In Denmark, after a radical reduction in the loan offer, a large number of private lending groups sprung up on Facebook. Similarly, in Slovakia, consumers started looking for other ways to borrow money. We can only speculate about whether customers in Poland will choose private loans or pawnshops.

According to Marcin Czugan, President of the Union of Financial Companies, the exclusion of almost 200,000 people from the financial market per month will mean that the place of lending institutions will be taken over by "other services". "These consumers will still want to borrow money for their needs. If they don’t get it from lending institutions and banks, they will go elsewhere, beyond the regulated sphere," explained Marcin Czugan.

Currently, the bill is at the parliamentary stage and has been referred to a subcommittee created for this purpose. Its first meeting is scheduled for March 30.

The study was conducted in February 2022 and included a calculation of how the loan market would behave after the introduction of new limits on loan costs proposed by the Ministry of Justice. The CRIF Analytical Department analyzed data from the ten largest lenders on the Polish market, supplementing this with a statistical analysis of 8.5 million loan requests registered in 2021.