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Tougher credit rules proposed

Socialists say 2010 Loi Lagarde does not go far enough to protect people from debt

THE government is looking to introduce tougher new measures on "revolving credit" - including credit and store cards - later this year, in an attempt to protect people from getting too far into debt.

The Journal du Dimanche reports that the Socialist party believes that the 2010 Loi Lagarde does not go far enough, and is planning more measures for the rentrée.

They include giving consumers the option of taking out a fixed-sum and fixed-rate personal loan when making a large purchase, instead of a more flexible pool of credit, making the cost of borrowing much clearer and banning shops from associating a credit facility with a store loyalty card.

Consumer group UFC-Que Choisir is also calling for more checks to be carried out on borrowers seeking sums of €1,000 or more.

The group is already taking legal action against a number of lenders and retail groups claiming that shoppers are not made fully aware of what they are signing up for when they take a store card or use a buy-now-pay-later offer.

However, one credit provider warned in the Journal du Dimanche that applying too strict rules to consumer finance would harm spending and dent the economy further.

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