Last week, the bench of senators from Town meeting (AC) elevated the Vice President of the Republic, Beatriz Argimon, the debt restructuring project for individuals. from the party of the Multicolor Coalition They understand that the treatment of the same must be of a “urgent“, or else they would try to force it through a plebiscite.
Among the main reasons put forward by the lobbyist caucus, they maintain that “in recent years they have proliferated in Uruguay financial companies that offer loans with easy access”, where “the average financial cost of this financing scheme is generally excessive for the individuals who receive it”, and “generating high levels of indebtedness in thousands of people with little wealth“.
In turn, they added that these citizens live “in the permanent anguish of collection strategies that border on the threat through credit recovery companies that literally harass them“leaving these people in”a kind of civilian death“due to its registration in the clearing, and in the register of debtors categorized by the Central Bank of Uruguay (BCU).
It is estimated that 90% of Uruguayan families take some type of credit
According to estimates, the around 90% of Uruguayan families would take some type of credit, either directly through financial companies, or your credit card. According to data from the consulting firm Exante, the family credit stock as of March 2023 it exceeded $9.7 billion.
In the breakdown of the figure, almost 3,400 million dollars correspond to mortgage loans, almost 500 million dollars to auto loans, and more than 5,800 million dollars to consumer loans. The figures cover banks and credit companies alike.
The greatest criticism of these credits is generally directed at the high interest rates, and stressing to companies the obligation to correctly inform the Effective Annual Rate (TORCH).
What does the Open Cabildo bill say?
In Article 1, the creation of “a judicial procedure to restructure the liabilities of natural persons” is proposed, which “must be preceded by a conciliation process in the administrative field“.
According to Article 2, “those debtors with private individuals or legal entities, or with state entities” who do not have a real estate asset, or have only one intended for housing and that does not exceed the cadastral value of 1.6 million Indexed Units (UI).
Nor may they be owners of vehicles that cost more than 150,000 IU according to the value awarded by the Single Vehicle Income Collection System (dirty), or who receive nominal annual income less than or equal to the sum of 240,000 IU.
In Article 9, it is added that the debtor requesting the restructuring must present a payment plan, respecting the requirements of Article 4, and taking into account the concept of fair debt (Article 15).
According to Article 14, it will be presumed that creditors acted illegally when:
- When granting a loan, they do not inform the debtor of the total amount of the credit to be paid.
- Advertise without it containing information about the interest rate.
- Carry out abusive practices for the collection of creditssuch as violations of the privacy of individuals, or the use of erroneous information.
Said behaviors would be sanctioned with a fine equivalent to 20% of the unpaid balance of the original creditconverted to UI on the date of the last amortization, and updated to the present at the TORCH of the 2%.
Article 15: For the restructuring of the payment, the fair debt will be considered, which is defined as the amount initially agreed in any currency (converted to UI), to which is added a 2% APR for interest, fines, or any other type of surcharge, and the payments made by the debtor are subtracted, for all concepts and converted to UI, up to the date of the restructuring request.
This fair debt will serve as the basis for the restructuring proposal, and this cannot exceed its amount, which can only be subject to write-offs. “In case of proposed cancellation in installments, these may not exceed 30% or 40% of monthly income of the debtor in accordance with the provisions of Article 5 of this law”, says Article 16.
The maximum interest, according to Article 23, may not exceed the equivalent of 4 times the value of the rates at which the State is indebted.
The maximum interest that can be charged for operations in dollars “shall not exceed three times the value of the weighted averageby amount issued, of the coupons to be paid by the General Treasury of the Nation in the three most recent issuances of Global Bonds denominated in dollars at a fixed rate.
For both currencies, the maximum default rate will be set at a level twenty% greater than the corresponding maximum rate.
Source: Ambito
