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“We are talking about cases in which the financial capabilities of the client do not meet the criteria for a responsible loan. Then they are offered an alternative: not to buy the product, but to rent with the possibility of exchange. In this case, at the end of the contract, the residual value of the property is small compared to the rent already paid, so it is not beneficial for the consumer to return the rented property. However, such a practice can harm both the consumer and the company, “the report cites to Justina Tarasevičienė, Chief Legal Counsel of the Credit and Insurance Services Supervision Division of the Bank of Lithuania.
According to the Bank of Lithuania, the conclusion of contracts for the lease of goods in cases where the customer really wants to buy the goods, organizing their payment in installments is an inappropriate practice. It seeks to circumvent the requirements of the Consumer Credit Law and, at the same time, deprives the consumer of the protection that the law guarantees.
The bank draws the attention of merchants and financial market participants: they must clearly understand what customers want and be guided by their interests when providing services, without encouraging options or offering leases if the consumer is looking to buy a product.
In this case, the Consumer Credit Law must be followed when entering into contracts. Its main objective is to protect consumers from irresponsible loans and their negative social and financial consequences.
To do this, the creditworthiness of consumers is evaluated, the price of the loan is limited (the amount of interest and all other taxes cannot exceed the amount of consumer credit received, etc.) and interest rates are set. . Furthermore, only companies supervised by the Bank of Lithuania and included in the Public List of Consumer Credit Providers are entitled to grant consumer loans. The consumer protection measures enshrined in the Consumer Credit Law are lost if goods lease contracts are concluded with a company whose activities are not supervised.
Having clarified the cases where the objective is to avoid the application of the Consumer Credit Law, the Bank of Lithuania has the right to apply sanctions.
For our part, we urge consumers to reconcile their wishes with financial opportunities, to evaluate them realistically and responsibly. Attempts to outsmart you can result in higher costs or other negative consequences.
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