Financial education campaign “Make Sense of Money”: consumer credit
Automatically translated summary. The full text is available in Romanian.
As part of the financial education campaign “Make Sense of Money”, this note explains what a consumer credit is in the Republic of Moldova, where banks and non-bank lending organisations can lend to individuals. It outlines contract rules, how to compare offers and the main risks borrowers should consider.
Under the Law on consumer credit contracts, every offer must state the nominal interest rate and fees, the total amount of credit, the annual percentage rate (APR), the contract duration, and the total amount payable and monthly instalments. Consumers may cancel within 14 days without giving a reason, repaying the money received plus interest. Early repayment is allowed at any time; any penalty may not exceed the total interest actually “lost” by the lender.
The APR is the key tool for comparing offers, as it expresses all costs, except late-payment penalties, in a single figure. Risks include rising interest rates, falling income or job loss. Low-income people, those with unstable income or limited financial literacy are most vulnerable to over-indebtedness, so borrowers should assess need and repayment capacity carefully. Insurance against unforeseen events, such as unemployment or incapacity, is available.
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