By Chrysostomos Tsoufis

The ability to pay with their mobile phone through the IRIS system and without commissions should soon be provided to their customers by all freelancers and self-employed active in the country. The Ministry of Finance’s law that was presented to the cabinet obliges them to link their business accounts to the direct payment system – which in Greece is currently only the IRIS system. It is still under consultation whether this obligation will be timed with the POS-cashier interface by 29 February or whether it will be decided to come earlier as the process of connecting to IRIS is extremely simple. In any case, the goal is twofold. Citizens and professionals save time and money and the Ministry of Finance acquires another weapon in its effort to limit tax evasion.

In the bill presented by Kostis Hatzidakis a series of regulations are foreseen to protect borrowers, rationalize and strengthen the competition of the wider financial system:

PROTECTION OF VULNERABLE BORROWERS

It is foreseen that in the cases of arrangements of the extrajudicial mechanism concerning the vulnerable – up to €7,000 individual income, +€3,500/protected member up to €21,000 – the creditor (bank or public fund) is obliged to accept the solution proposed by the algorithm whatever if it’s her The creditor can challenge it only judicially and only with evidence proving that the debtor is not vulnerable. Today, with an official decision according to the Ministry of Finance, he may not accept the regulation. It is typical that 1 in 2 arrangements involving vulnerable borrowers today is rejected.

BORROWER PROTECTION TOTAL

The bill provides for changes in the calculation parameters of the special algorithm proposed arrangements under the extrajudicial mechanism that will lead to a bigger haircut than what happens today up to 28%

The interest rate of the arrangements becomes a fixed 3% for three years (from floating Euribor +2.5-3% depending on whether or not there is collateral) and for debts to banks and servicers. The fixed interest rate only applied to debts owed to the State.

Natural persons who “inherited” the debts of businesses that have closed will be able to use the extrajudicial mechanism.
A grid of obligations is provided for servicers.

Until March 31, debtors will have to provide personalized information on the amount, the balance, the installments, the interest rate of the debt settlement through a special electronic platform, which the debtors will enter with codes. Until the end of March, they are again obliged to provide this information within 1 month of the relevant request of the debtor.

They should protect borrowers’ personal information and privacy

Harassment and coercion are prohibited

They must inform in writing of the amount owed after any transfer of credit

Failure to comply is punishable by a fine of up to €500,000 and even revocation of the operating license.

ACQUISITION AND RE-LEASE AGENT

Mr Hatzidakis admitted that investment interest in the operator is thin and the improvements aim to increase its “attractiveness”.

It is provided that the operator can purchase the property at a 30% discount on its commercial value. Of course, the same discount also applies in the case of the repurchase of the property by the debtor.

It is also provided that for the recovery of the property, the debtor’s obligation to pay rent for 12 months ceases.

STRENGTHENING COMPETITION

The bill provides for the possibility of granting housing and business loans subject to conditions (refinancing of an existing loan, businesses with a regulated loan, restructuring of a borrower business) AND by credit companies PLUS the banks. Today such companies can only give consumer loans.

The goal of the Ministry of Finance is to pass the bill in November.