FAS: BANKS ARE REQUIRED TO INDICATE THE RANGE OF FULL CREDIT AND LOAN VALUE IN ADVERTISING

The relevant law shall come into force on October 23, 2023*

The advertising of credit or loans indicating interest rates should also contain information about the ranges of values of the total cost of consumer credit as a percentage per annum. It means that it is not allowed to indicate only attractive information in advertising, for example, the minimum rate, which is often not set for the entire term of the loan or requires compliance with additional conditions.

Information about the range of values of the total cost of the loan (TCL) should be indicated before mentioning interest rates, and the font should not be less than the font with which the rate is indicated. The requirement to specify a range of TCL values also applies to advertisements with audio accompaniment. The norm will be applied to any consumer loans, including mortgages.

At the same time, there is an obligation in the advertising of credit and loans to indicate all the conditions for the provision of such services that affect the amount of expenses that borrowers will incur if at least one of these conditions is reported in the advertisement.

The changes will allow consumers to see the total cost of the loan in advertising, calculate their financial burden more consciously, which will contribute to suppression of practices that can mislead borrowers.

* Federal Law of July 24, 2023 No. 359-FZ "On Amendments to the Federal Law "On Consumer Credit (Loan)" and Certain Legislative Acts of the Russian Federation"