Why is the government tightening belts on service providers?

Recently, we have been witnessing the imposition of significant measures Fines From the Ministry of Development to a number of multinational companies operating in the field of consumer products. Fines were imposed due to illegal profiteering, as the controls of the relevant departments at the Ministry of Development found violations of legislation stipulating a ceiling on the gross profit margin.

Since the beginning of the year, the Ministry of Development has imposed fines totaling 10.3 million euros, and in November alone the fines exceeded 5.5 million euros.

Last week we witnessed this, along with the passage of the new law regarding “Red loans“, imposing administrative fines on two companies in the financial sector. These companies are service companies, that is, they are loan and credit management companies.

Companies that manage the “red loans” sold by banks to the funds, in the context of consolidating their balance sheets and unhindered implementation of their primary mission, which is to finance the real economy. Through this process, service providers create value for banks and investors who have purchased non-performing loans, contributing to the sustainable development of the financial system.

The new law that was passed closes some important pending issues that made the work of service providers difficult, and improves the situation of borrowers and consumers, while opening the way for the brave. Settings Within the framework of an out-of-court settlement.

In particular, the law stipulates strict new obligations related to transparency, in order to provide better information to borrowers, improve the out-of-court dealing mechanism and provide special care for vulnerable groups, and enhance competition, by granting loans from credit companies other than banks. Simplifying and accelerating bankruptcy law procedures and extending the “Hercules” program to reduce “red loans” in banks.

The two fines were imposed, on the one hand, on doValue Greece, in the total amount of 435 thousand euros, which appears to be fraudulent, and on the other hand, on Cepal Hellas, in the total amount of 235 thousand euros. At the same time, market checks to ensure compliance with the law are also carried out by the supervisory authority, the Bank of Greece.

In September 2023, an administrative fine of 60 thousand euros had already been imposed on doValue Greece, by the General Directorate of Procurement and Consumer Protection of the General Secretariat of Trade of the Ministry of Development, because it had repeatedly caused disturbances and sent an extrajudicial letter. To inform the debtor of the existence of overdue debts, which debts were already under settlement based on the court decision in the context of Law 3869/2010, and this settlement is usually served by the debtor borrower.

The administrative fine was imposed in December 2023 totaling €435,000 again by the General Directorate of Market and Consumer Protection of the General Secretariat of Trade of the Ministry of Development. This was accompanied by a statement from the Minister of Development in which he stated that violating the law and unacceptable behavior by collection companies is unacceptable, and that companies must respect citizens and take into account the legislation that regulates their work. He concluded by saying that the Ministry of Development will continue intensive inspections.

This time, the fines imposed on doValue were for repeated inconveniences of notifying debtors of delinquent debts that had been submitted to arrangements that were normally provided. As well as unfair practice by displaying aggressive behavior using clearly offensive statements against the debtor when informing him of the existence of an overdue debt.

No one doubts it Sterilization role Which services play in the market, in the banking and financial system and in the real economy. No one doubts its contribution to returning the banking system to the growth path. However, service providers must operate strictly within the normative and regulatory framework designed and legislated by the state.

The state, for its part, must exercise the necessary controls and protect borrowers, debtors, and consumers in general. This appears to be happening, as with the 1520 phone line operational, consumers can be informed of consumer protection issues and file complaints about consumer law violations.