Loans To The Population

A representative of the IO Finance spoke to the media and promulgated new standards for payday loan and the rules they must follow in order to work in the market and issue loans to the public.

The microcredit organizations must be listed in one of them. A total of 2.3 thousand organizations are registered in the register of the GV Bank. Any payday loan may offer to submit any rules of work for review by an IO Finance. All three IO Finances actively participated in the creation of new basic standards and rules.


Impact of the Innovation to the Market

impact of loan

Other experts say that the main changes within companies will be purely organizational in nature. It will be necessary to train the staff, to refine the business process. Due to the fact that in small companies the staff is not large, then it will be easier, faster and cheaper to train them. Based on this opinion, we can conclude that small companies will not rapidly leave the market due to innovations.

The same changes will affect the work on scoring borrowers. New requirements for customers will be added and, consequently, processes for processing customer information will be added. Employees of companies issuing loans to the public will have to deal with methods that they have not operated on before.


Loans to the public will become more transparent

Most likely, many companies will change their status after the introduction of new standards. Perhaps, some organizations, nevertheless, will leave the market, not agreeing to accept new duties. IO Finance experts believe that there will not be a massive reduction in the number of payday loan. It is planned that innovations will make loans to the population more transparent, which will attract many investors in this segment of the financial market.

It was decided to limit the number of loans “in one hand”, which should prevent the development of “predatory” lending and provide better protection for the borrower. There will be an increase in checks made, both towards the payday loan themselves, if there are complaints against them, or towards individual employees of the company to check their competencies.

Loans to the public will become more transparent

According to statistics, annually from 10 to 15 thousand claims are sent to the QW Bank in the direction of the payday loan. The same complaints to self-regulating organizations receive almost 5.000.000 each year. An interesting fact is that loans to the population are improving in quality, and at the same time the number of negative calls is growing. Most likely, the fact is that consumers of microloans are beginning to understand that their complaints are really considered and influence the improvement of the situation.

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In the title documents are prescribed and measures in case of violation of the new rules. Companies that provide loans to the public can receive an order to eliminate the violation or a fine. The latter is planned to be increased several times so that it can really act on the organization and its directors.

The most serious punishment provided for in the new basic standard is the exclusion of a company from an IO Finance. To do this, the company must commit a very serious violation that infringed the rights of the client or investor. Just do not abuse the minor violations, if they are systematically repeated, it can cause an exception.

In the future, microfinance organizations will have to adopt new rules and standards in order to issue loans to the public. It is planned to introduce rules that describe each stage in issuing a loan, as well as attracting funds from individuals. It will be necessary to disclose information about its activities. As well as to assess the solvency of its customers, according to the new regulations.

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