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BAN

Stricter requirements for SMS loans

Sweden's government has proposed placing tighter requirements on SMS-loan companies to carry out credit checks. However, proposals for interest rate caps or prohibitions on overnight loan payments have been rejected.

Published: 10 June 2010 16:08 CEST

The number of unpaid bills for quick SMS loans has grown rapidly in recent years, and many young people have fallen deeper into debt. In legislative amendments adopted on Thursday, it was suggested that the same requirements for a credit check as apply to other loans should be applied to SMS loans.

In practice, the rules will force lenders to collect data on income and expenses both from the borrower and from an independent source like a credit information company. SMS loans are currently exempt from the requirements of the law governing credit reviews.

The government would also introduce a right of repayment, meaning that consumers can repay the loan within 14 days and avoid other costs besides the interest for the time he or she had the loan.

The Consumer Ombudsman has argued that the repayment period hardly helps the consumer because those who take out SMS loans usually spend the money as soon as they receive it.

In Finland, borrowers are prohibited from taking out their money before 7am if they applied for and are granted the funds between 11pm and 7am. The reason is that such applications are considered as being based on hasty decisions.

Sweden’s official debt collection agency, Kronofogden, believes that loans taken in the last hours of the day are usually used for games and purchases online. However, the government believes that a ban would place too many restrictions on the freedom to enter into contracts and points out that payments would still be delayed because of the new requirements on credit reviews.

The government has also rejected the idea of an interest rate cap as proposed by a commission at Uppsala University. Such a ceiling would lead to less competitive conditions. Instead, loan company marketing materials will be forced to clearly state current interest rates.

The amendments, which are based on an EU directive, will come into force on January 1st.

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GOVERNMENT

Was Norway ill prepared for the Covid-19 pandemic?

A report from a Norwegian commission appointed to assess the country’s management of the Covid-19 pandemic has concluded that while the government handled the situation well, it was poorly prepared for the crisis.

Published: 14 April 2021 17:11 CEST
Was Norway ill prepared for the Covid-19 pandemic?
Photo by Eirik Skarstein on Unsplash

The 450-page report was submitted to Prime Minister Erna Solberg by medical professor Stener Kvinnsland, who led the review.

The commission found that, generally, Norway had handled the pandemic well compared to the rest of Europe. That was in part due to citizens taking infection control measures on board.

“After a year of pandemic, Norway is among the countries in Europe with the lowest mortality and lowest economic impact. The authorities could not have succeeded if the population had not supported the infection control measures;” the report states.

However, the commission’s report also outlined that Norway did not properly prepare itself for the pandemic.

“The authorities knew that a pandemic was the most likely national crisis to have the most negative consequences. Nevertheless, they were not prepared when the extensive and serious Covid-19 pandemic came,” it said.

Prime Minister Erna Solberg said during an interview with the commission, conducted as part of its work, that the government did not have an infection control strategy of its own.

“We had a ‘we have to deal with a difficult situation’ strategy. We had to do everything we could to gain control and get the infection down. It was really only at the end of March (2020) that we found the more long-term strategy,” she told the commission.

Low stocks of personal protective equipment were another source of criticism in the report.

“The government knew that it would in all probability be difficult to obtain infection control equipment in the event of a pandemic. Nevertheless, the warehouses were almost empty,” Kvinnsland said at a press conference.

Norwegian health authorities were praised for the swiftness with which they implemented infection control measures. But the commission said that the decision should have been formally made by the government, rather than the Norwegian Directorate of Health.

READ MORE: Norway saw fewer hospital patients in 2020 despite pandemic 

The implementation of restrictions in March 2020 was critiqued for failing to ensure that “infection control measures were in line with the constitution and human rights.”

One-fifth of municipalities in Norway lacked a functioning plan in the event of a pandemic according to the report, and the government did not provide enough support to municipalities.

“We believe that government paid too little attention to the municipalities. The municipalities were given much larger tasks than they could have prepared for,” Kvinnsland said.

The report was also critical of Norway’s lack of a plan for dealing with imported infections in autumn 2020.

“The government lacked a plan to deal with imported infections when there was a new wave of infections in Europe in the autumn of 2020,” the report found.

“When the government eased infection control measures towards the summer of 2020, they made many assessments individually. The government did not consider the sum of the reliefs and it had no plan to deal with increasing cross-border infection,” it added.

The report also concluded that Norway allowed itself to be too easily lobbied by business when deciding to ease border restrictions last summer.

The division of roles in handling aspects of the pandemic was scrutinised in the report. Here, the division of responsibilities between the Ministry of Health and Care Services, The Norwegian Directorate of Health and the Norwegian Institute of Public Health were unclear.

The prime minister has asked the commission to continue its work.

“We are not done with the pandemic yet. Therefore, it is natural that the commission submits a final report. There will also be topics where the learning points can only be drawn later,” Solberg said.  

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