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Credit advertising in Ireland

Information

There are strict rules governing the advertising of credit to consumers in Ireland. These rules are set down in the Consumer Credit Act, 1995. The credit provider (the lender) is responsible for ensuring that its advertisement complies with the rules set out in the Act. It must not publish, display, or submit to others (for example, a publisher) an advertisement that breaks the rules. An advertiser who is not a credit provider (for example, a publisher) can claim that it received the advertisement in question for publication in the ordinary course of business and did not know or had no reason to suspect that its publication would breach the provisions of the Consumer Credit Act.

Credit advertisements must clearly represent what is being offered to the consumer by the advertiser. An advertisement can be:

  • In a publication
  • On television or radio
  • By display of notices, signs, labels, showcards or goods
  • By distribution of samples, circulars, catalogues, price lists or other material
  • By exhibition of pictures, models or films.

Credit advertisements are defined as advertisements offering:

  • To provide or arrange provision of credit
  • To let goods or arrange the letting of goods by another person under a hire-purchase or consumer hire agreement
  • To provide to arrange housing or arrange the provision of housing loans.

The provisions do not apply to Credit Unions and Friendly Societies.

Rules

Requirements for the advertising of credit

Advertisements of credit must contain:

  • The Annual Percentage Rate (APR), which must be shown in a very prominent place. A definition of APR is "the total cost of credit to the consumer, expressed as an annual percentage of the amount of credit given". In general, the lower the APR in a credit agreement, the lower the overall cost of credit. It is a good way to compare various types of credit available to you. If the APR figure on the advertisement is an estimate of the real amount, this must be clearly stated.
  • Whether security is required
  • Clear indications of any restrictions on the availability of credit
  • Details of any charges on top of the payments and interest

Financial accommodation

Financial accommodation is the term used to describe a hire purchase agreement, a consumer hire agreement or the provision of a service. Advertisements for these will need to include:

  • The kind of the accommodation (i.e., service, or hire purchase, etc)
  • The cash price of the goods/service
  • The total cost of credit or the hire-purchase price
  • Details of the number, amounts and timing of installments
  • Details of any deposit involved in agreement
  • The numbers of installments that need to be paid before you will receive delivery of goods
  • Any details concerning another form of credit, which might be used as a comparison in the advertisement

An advertisement for credit cannot be described as being free from interest if it concludes that there is an extra maintenance or insurance contract involved.

Advertising of consumer hire agreements

There are, in addition to the provisions outlined above, certain requirements that particularly apply to consumer hire or leasing agreements. The fact that ownership does not pass to the consumer in a leasing agreement must be stated in any advertising. The statements "Letting, Hiring or Leasing of the Goods Only" and "The Goods Remain the Property of the Owner" should be included. These statements should be in at least as prominent a position as any sum payable by the hirer and enclosed in a boundary box in a visual advertisement. The amount that is payable by the hirer must be indicated in the advertisement and include all amounts, including taxes.

The Central Bank of Ireland

The Central Bank has the power to bring charges against any parties involved in credit advertising. If it confirms that there are grounds to pursue the matter, it will go directly to the company or institution involved and raise concerns about the issue. If matters are not sorted out between the Central Bank and the company or institution, the case can be heard before the District Court. If found guilty, the credit provider is liable to a fine or a prison term or both. The credit provider is also liable to pay an extra fine for every day that the infringement continues. Legal proceedings can be commenced at any time up to two years after the offence is committed.

How to apply

Reporting breaches of advertising regulations

To complain about an advertisement of credit, you must apply in writing to the Central Bank. The letter should state the nature of the offence and the company or institution against whom the complaint is being made.

Where to apply

Central Bank of Ireland

Financial Regulation
PO Box 559
Dame Street
Dublin 2
Ireland

Tel:(01) 224 6000
Locall:1890 777 777
Fax:(01) 671 6561
Homepage: http://www.centralbank.ie/regulation/Pages/home.aspx
Email: enquiries@centralbank.ie


Page updated: 7 December 2010

Language

Gaeilge

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Contact Us

If you have a question relating to this topic you can contact the Citizens Information Phone Service on 0761 07 4000 (Monday to Friday, 9am to 8pm) or you can visit your local Citizens Information Centre.