CCD II in Austria: VKrG 2026 and BWG changes expand scope of application and strengthen governance standards

With the ministerial draft of the new Consumer Credit Act (Verbraucherkreditgesetz, VKrG 2026) and the accompanying amendments to the Banking Act (Bankwesengesetz, BWG), Austria is implementing Directive (EU) 2023/2225 on credit agreements for consumers (CCD II). While the VKrG 2026 reorganizes the rules on consumer credit and expands the scope of application as well as transparency, process and assessment standards, the amendment to the BWG establishes a supervisory framework that, in particular, confers on the Financial Market Authority (Finanzmarktaufsichtsbehörde, FMA) clearly delineated competences in the field of collective consumer protection. As a result, credit institutions will be subject to enhanced compliance, organisational and governance obligations.

VKrG 2026: Background, timeline and regulatory architecture

CCD II seeks to adopt the objective of adapting consumer protection in relation to credit agreements to technological and market developments and to ensure harmonisation across the Union. According to the EU legislator, Directive 2008/48/EC has proved only partially effective, in particular in light of digitalisation, new product forms such as BNPL (“Buy Now Pay Later”), and divergent national implementations. The new legal framework is considerably broader in scope, provides for a higher degree of full harmonisation, and is tailored to modern distribution channels. The VKrG 2026 will apply to agreements concluded on or after 20 November 2026. However, certain provisions will also apply to agreements concluded before 20 November 2026 that are still in force.

The VKrG 2026 specifically addresses:

Particularly significant is the extended scope of application. The new act now also covers credit with a total amount of less than EUR 200 and credit granted free of interest and without any other charges. The previous threshold of EUR 200 is abolished; contracts that are “free of interest and without any other charges”, which were expressly excluded from the scope of Directive 2008/48/EC, are now covered.

This results in a substantial expansion of the scope of the VKrG 2026. In the future, not only traditional consumer loans will be subject to the consumer‑protection framework, but, in principle, any form of deferred payment or financing assistance—irrespective of whether it is granted on a short‑term basis or free of charge. The EU legislator’s focus here was on the “Buy Now Pay Later” (BNPL) business model, which has become established particularly in digital commerce and has always been considered problematic from a consumer‑protection perspective.

Since a fully capturing of all deferred payments in online commerce would not be appropriate, an exemption has been implemented in Section 39(2) No. 3 VKrG 2026 to the effect that typical deferred payments granted by suppliers of goods or providers of services do not fall within the scope of the VKrG 2026, provided certain conditions are met. It is also welcome that, in the draft, the Austrian legislator has exercised the option to exempt “deferred debit cards”. As a result, common payments by credit card are covered by the exemption, which provide consumers with temporarily deferred settlement and thus greater flexibility in household budgeting (Section 39(2) No. 2 VKrG 2026).

New competence of the FMA for collective consumer protection

In parallel, the supervisory architecture is being modernised: a key innovation is the introduction of a clear distinction between individual and collective consumer protection. The FMA will, for the first time, be responsible for administrative enforcement in the area of collective consumer credit law. Pursuant to Section 33a(1) No. 1 BWG, credit institutions must establish arrangements to prevent infringements which, by their nature or scale, may jeopardise the interests of more than one consumer. The explanatory notes clarify that this refers to systematic infringements, whereas infringements concerning individual consumer protection do not fall within the FMA’s supervisory remit.

Another key novelty is the extension of the FMA’s supervisory competence to the field of consumer credit. Section 3(9) BWG has been supplemented to include compliance with the new Section 33a, as a result of which the FMA is now also responsible for conduct‑of‑business‑oriented on‑site inspections in relation to consumer credit.

The newly introduced Section 33a BWG constitutes the core of the amendments and obliges credit institutions to take comprehensive measures:

Supervision and oversight by the FMA

The FMA is vested with comprehensive powers:

Conclusion

For creditors, the VKrG 2026 primarily entails the timely adaptation of existing processes by the date of application on 20 November 2026. The focus is on reviewing the extended scope of application.

The amendments to the Banking Act constitute an important step towards strengthening collective consumer protection. The clear allocation of responsibilities, with the FMA as the supervisory authority, creates effective control mechanisms. While the new provisions entail additional obligations for credit institutions, they ultimately also serve to mitigate risk and to promote responsible lending practices.

Note

This article provides a general overview and does not constitute legal advice. It cannot replace individual legal consultation.

For further information, please refer to Binder Grösswang’s website, where additional parts of the Neues Verbraucherkreditgesetz 2026 series have been published.