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Make access to payment holidays easy or face fines, Polish watchdog tells banks

·1-min read

WARSAW (Reuters) - Polish banks could potentially face fines of up to 10% of their annual turnover if they make it difficult for mortgage holders to take advantage of payment holidays, the consumer watchdog said on Tuesday, days before the programme comes into effect.

The payment holiday scheme, effective from Friday, is intended to help mortgage owners whose monthly instalments have surged due to rising interest rates by allowing them to skip a maximum of eight payments in 2022 and 2023.

However, Tomasz Chrostny, head of Poland's consumer watchdog UOKiK, said some banks had tried to discourage customers from taking payment holidays by telling them it could affect their credit worthiness in future.

He also said some banks complicated the process by providing too many different forms to fill in.

"If banks do not immediately change their practices aimed at making it difficult for consumers to take advantage of credit holidays, they must expect to face complaints and their consequences," he said in a statement.

UOKiK will analyse the way the programme is implemented at 16 Polish banks, it said. If irregularities are found, the banks could face fines of up to 10% of annual revenue.

The banking sector has been critical of the scheme, saying that access to payment holidays should be limited to those borrowers in the most difficult financial situation so as to avoid excessive costs for banks.

Some economists say that the programme will also serve to stoke inflation that has already risen to a 25-year-high of 15.5%.

(Reporting by Alan Charlish; Editing by Susan Fenton)

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