When taking out a loan, most people quickly think of a visit to the bank. Or to request a quote from an online loan provider. But since fairly recently (as of January 1, 2017) a mobile phone that comes with a subscription also counts as a loan. And from last May (2017), telecom providers must perform a credit check if a customer purchases a mobile phone with a value of more than 250 euros. The idea behind it is self-evident that consumers will not enter into obligations that they cannot handle financially. So far all nice and nice, but do the new rules work? The AFM (Financial Markets Authority) was curious about that. And when the AFM started investigating the way in which telecom providers dealt with the new rules, it turned out that things could still be improved.
Amounts are entered as standard
The research shows that most telecom providers have already set a number of amounts in the form on their site in advance. Clients must state their family situation and, based on this, (monthly) expenses and income will come forward. The idea is that the consumer then adjusts the amounts so that they match reality. In itself a nice service from the telecom provider, because the less a consumer has to fill in himself, the easier and faster it goes of course. But then it is of course useful if the customer actually checks the amounts and does not simply confirm the amounts entered in advance. And there it turned out to go wrong quite often in the research.
Completed forms lead to over-credit
The AFM investigation revealed that many customers do not adjust the standard amounts to their actual financial situation. Logically you get a financial picture that is not right. You could even say that completing the creditworthiness test is of no use in this way. This test must make it clear whether someone can safely take out the loan (in this case the telecom subscription) without getting into trouble. That of course only becomes clear if the data is actually correct. The AFM therefore concluded that forms on which advance amounts were entered as standard could lead to over-credit. In short: a risk was created for the consumer in this way.
Telecom providers must stop entering data in advance
Because the AFM considered the risk of over-crediting too large, the telecom providers were called to account for this. The AFM has forbidden them from already filling in the forms for the credit check in advance. In the meantime (almost) all telecom providers have listened to the AFM and no more amounts are entered in advance. The AFM has indicated that it will also check with other financial products what the effect of entering data in advance will have on the consumer.