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Consumer credit agreements

Consumer credit agreements



Directive 2008/48/EC on consumer credit agreements


  • It harmonises EU rules regarding credit granted to consumers who borrow to finance purchases of goods and services (holidays, goods, new cars, etc.)
  • It aims to open up the EU’s consumer loan market, whilst improving the transparency of contract terms and the level of consumer protection.


The directive does not apply to credit agreements:

  • guaranteed by a mortgage, which are regulated by Directive 2014/17/EU on credit agreements for consumers relating to residential immovable property;
  • to acquire land or property, which are also regulated by Directive 2014/17/EU;
  • for less than €200 or more than €75,000. However, by 21 March 2016 at the latest (the date by which Directive 2014/17/EU had to become law in EU countries), the directive had also to be applied to non-guaranteed credit agreements for the renovation of residential immovable property, for more than €75,000.

Advertising for credit that includes aspects relating to the cost of this credit (for example, the interest rate) must provide standard information based on a representative example, containing, amongst other things:

  • the rate of interest and cost details;
  • the credit amount;
  • the annual percentage rate (APR) which represents, in the form of a percentage, all mandatory costs in order to obtain the credit (loan interest rate, administration fee, obligatory insurance premiums, guarantee fees, etc.).

Pre-contractual phase

During the pre-contractual phase, the lender must provide understandable information on the essential features of the credit offered in good time before entering into the contract. This includes, amongst other things:

  • the duration of the credit agreement;
  • the total credit amount;
  • the borrowing rate and terms applicable to this rate;
  • the annual percentage rate and the total amount due by the consumer;
  • the amount, number and frequency of payments;
  • fees related to or resulting from the agreement;
  • consequences of late payment and non-performance.

Consumers should receive information in a standardised format.

Regulation (EU) 2016/1011 amends Directive 2008/48/EC and requires the lender during the pre-contractual phase to the consumer credit agreement, where the credit agreement references a benchmark, to provide the name of that benchmark and of its administrator and the potential implications for the consumer.

Credit agreement contract

The credit agreement must also contain similar information in a similar format to that provided during the pre-contractual phase.

Lenders must:

  • provide adequate explanations to consumers so they can choose an agreement which meets their needs and financial situation;
  • assess their customers’ creditworthiness before signing an agreement, and inform the consumer, if their credit application is rejected, of the result and the details of the credit database used.

Consumers must:

  • have 14 days in which to withdraw from the agreement, without having to state a reason;
  • have the right to make early repayment of their credit at any time, provided that the creditor receives fair and objectively justified compensation.


It has applied since 11 June 2008 and had to become law in the EU countries by 11 June 2010.


For more information, see:


Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC (OJ L 133, 22.5.2008, pp. 66-92)

Successive amendments to Directive 2008/48/EC have been incorporated into the original document. This consolidated version is of documentary value only.


Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 (OJ L 60, 28.2.2014, pp. 34-85)

See consolidated version.

last update 06.05.2019