The Ministry of Commerce and Industry(MoCI) plans to tighten the loan market through new rules that it plans to put in place to ensure an increase in its presence in all outlets selling consumer goods in installments because of the premium interest margin, Al-Rai reported.
In this regard, relevant sources revealed to the daily that the MoCI is studying setting up a supervisory mechanism to ensure compliance with the controls regulating credit operations carried out by companies and commercial establishments that are not subject to the supervision of the Central Bank of Kuwait, resulting from the installment sale of goods and services or any forward sales. Preparations in this regard will include coordination with the Central Bank, to set up a working mechanism and a joint memorandum of understanding between the two parties.
The sources told the daily that through field inspection tours and customer complaints, it was found that the prices of the goods purchased by some customers were higher in value than their corresponding prices in other places.
The sources pointed out that the Ministry of Commerce is working on setting new control requirements for companies that practice credit operations in their sales, making their prices under the Ministry’s radar, noting that among these requirements, which will be obligated to show the customer the prices of their goods in writing, and in a manner that shows their value.
Targeted cooperation
According to the sources, the initial ideas under discussion include that there will be cooperation between the MOCI and the credit information network company Scinet, which will collect information on all data related to loans and credit facilities.
The proposed scenarios within the open discussions in the ministry include the establishment of a specialized department to monitor the sale of installment goods, in an effort to ensure that their owners do not violate consumer protection instructions.
Increase censorship
The sources indicated that the MoCI move is to increase the control fenders that the ministry is building to protect the consumer, as these measures will lead to increasing consumer protection and educating them regarding the reality of the basic prices of their goods, and the interest margin that will be added to the cost of purchasing in installments.
It is worth noting that the previous decisions regulating sales of credit facilities included conditions required of those wishing to obtain credit facilities, related to the required documents and approvals, and the maximum repayment period, which is approximately 3 years, with the possibility of adding a fourth year in the event of scheduling.