Microcredits and their fine print
On many occasions, we have all considered the option of requesting a microcredit to cover some unforeseen expense. There are countless marketing entities that deliver a small amount of money quickly, comfortably, without prior financial verification and with immediate delivery, although Do we really know what the fine print states?
First of all, we must differentiate a Consumer credit of a microcredit:
- He Consumer credit It is that credit intended for the purchase of goods or services intended for own consumption (furniture, television, computer, etc.) that are normally granted by the store or business where the good or service is acquired and with prior approval from the entity. financial institution with which they collaborate.
- The microcredits They are small amounts of money (between three hundred and six thousand euros) that are requested from marketing companies not subject to the supervision of the Bank of Spain, which are granted quickly and without financial or solvency checks, given that they are not subject to the control of the Bank. Finance system.
It is in this second case, in that of microcredits, where the abuse remains latent: on the one hand, there is a lack of transparency and information towards the consumer who, motivated by their economic situation, accepts the contract without having been informed in advance. entirety on the clauses and contravening, in many cases, the LCGC, Law 7/1998 on General Contracting Conditions, April 14, 1998; and on the other hand, the APR applied to these types of loans are highly exaggerated compared to a conventional loan as they can reach up to 10.000%, 12.000% or 13.000%.
Unexpected consequences after requesting a microcredit
Due to this, sometimes the consequences can be even worse than the expected solution since the consumer, who normally requests this type of microcredit, usually has a difficult economic situation and when requesting it produces an even more negative inverse effect, since the Its repayment becomes increasingly difficult, as it generates very high interest month after month, added to the accumulation of the debt itself.
These abusive interests are clearly usurious. This is established by the Law of July 23, 1908 on the nullity of usurious loan contracts and? It came into force more than a century ago, the literal provision of which is that:
“Any loan contract that stipulates an interest noticeably higher than the normal amount of money and manifestly disproportionate to the circumstances of the case or under conditions such that it is leonine will be void, there being reasons to believe that it has been accepted by the borrower because of their distressing situation, their inexperience or their limited mental faculties.
The contract in which a greater amount is supposed to have been received than what was actually delivered will also be void, regardless of its entity and circumstances. The waiver of one's own jurisdiction, within the population, made by the debtor in this type of contract will also be void.”
The role of justice
For its part, Justice is clear regarding abusive interests. In 2015, the Supreme Court established that:
“9.- As we said in our previous ruling 628/2015, of November 25, the setting of an interest noticeably higher than the normal amount of money cannot be justified due to the risk derived from the high level of defaults linked to loan operations. Consumer credit granted in an agile way (sometimes, we now add, through aggressive marketing techniques) and without adequately verifying the capacity of borrower payment, since the irresponsible granting of consumer loans at interest rates much higher than normal, which facilitates consumer over-indebtedness, cannot be protected by the legal system (..).”
At the beginning of 2022, Justice annulled 20 microcredits requested by a same consumer. The Court understood that the consumer could not claim a lack of knowledge about them, since having contracted 20 microcredits, he must have certain information or experience about them. The nullity It occurred because the APR was close to 454.000% and the court ruled that, absolutely, an interest rate so manifestly far from a parameter of reasonableness can be justified.
This is, therefore, where the difference and abuse lies in this type of credit: in the high interest with which they are granted. The immediacy, the lack of guarantees or financial verifications do not lie in the very nature of the microcredit, since there are other tools in the legal traffic with similar characteristics.
How do we know if we are facing an abusive interest?
We will be facing an abusive interest when it exceeds the margins established as usual or conventional within the national scope. More specifically, it must comply with the provisions established by the Bank of Spain and its indicators. However, it is established as usurious interest is that interest that exceeds 15% of the average interest rate issued by the Bank of Spain.
Therefore, if a court declares that the interest is usurious, the clause would be null and void and it will be considered not included in the stipulated contract. Based on this, the consumer will only have to deliver the loaned amount as long as part of the capital has not been paid since, in this case, it will be the lender who will return to the borrower the excess difference with respect to the capital.
Thus we can highlight the ruling of the Provincial Court of Barcelona of March 6, 2018 to be clear:
“The interest provided for in the contract signed between the litigating parties was almost triple the average interest on consumer loans, which is why it should be considered usurious. The consequences of such a declaration are radical, absolute and original nullity, which does not admit confirmatory validation, so the borrower will be obliged to deliver only the amount received."
Conclusions of the analysis
In conclusion and after this analysis, it is clear that an exorbitant interest that is far from the average interest of the market can lead to being classified as usurious and this may give rise to its subsequent declaration of nullity. The lack of information and commercial lures are the key for the consumer, faced with a difficult economic situation, to request this type of credit where he or she is unprotected and disadvantaged throughout the entire process of contracting it.
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