The Finnish Justice Ministry’s proposal to cap interest rates on loans requested via text message will be sent to parliament in September.
The Helsinki-based ministry will review its proposal for possible changes after it finished consultations with those affected by the legislation, according to a statement today. The legislature will receive the motion “as soon as possible” after reconvening on Sept. 5, the ministry said.
The ministry on April 11 proposed to limit interest rates on loans of less than 1,000 euros ($1,243) at 50 percent to curb debt growth and an increase in unserviced loans.
The average SMS loan is for 243 euros and its current annual percentage rate is almost 900 percent, the ministry said. The number of court verdicts related to small loans rose to 82,000 last year from about 3,000 in 2005, the ministry said last month.