site.btaConsumer Protection Association Urges for Adoption of Legislation Regulating Debt Collectors' Activity 

 The Association for Protection of Consumers (APC) demands that the future 48th National Assembly adopts working legislation that regulates the activities of debt collection companies and those offering payday loans. According to data of the central bank, the increase of loans given by banks and non-financial institutions, which started in 2020, continues to this day. Such loans have increased by 13% year-on-year in July of 2022, APC head Peyo Mayorski warned in a statement for the media. 

The APC has warned many times about the high risk of citizens becoming indebted. The main reason for this is the shut-down due to the COVID-19 pandemic, which blocked most commercial activities. Many small and family-owned businesses went bankrupt. This was followed by an inflation spiral and an energy crisis, which does  not seem to be coming to an end any time soon. That is why, the share of non-serviced loans will continue to increase and according to central bank data, they have increased by 14.3% year-on-year and by 20.1% on a quarterly basis, the Association said. 

Given the unstable political situation and the expected fragmented parliament, the ACP calls on the political forces to act responsibly by adopting the necessary legislation that will reduce pressure on households. There is also the problem of debt collection companies and payday loan companies being allowed to ruin people's credit histories by marking them as indebted, despite court rulings to the contrary, the ACP said. 

The payday loans have increased by close to 23% since the start of this year, compared to the same period of 2021, which according to central bank calculations, means that such credits now exceed BGN 4 billion, and that is just for the first half of 2022. This amount stood at BGN 3.4 billion a year earlier, the Association said.