Licensing Of Entities Providing Consumer Loans

Current status

In the Slovak consumer lending market, in addition to banks, an important role is also currently played by other providers, which are usually denominated as non-banking companies.

Until recently, and in contrast to banks, such non-banking companies were not required to obtain a license from the National Bank of Slovakia ("NBS") or from other state authorities in order to provide loans, and were only subject to NBS supervision to a limited extent. Act No. 129/2010 Coll. on consumer loans, as amended ("Act"), which serves as legal basis for the provision of consumer loans, stipulated that the only obligation of non-banking companies was to register in a so-called "creditors registry" administered by the NBS. This main obligation of a non-banking company, when compared with the licensing procedures of other entities in the financial sector (such as the previously mentioned banks or insurance companies), represented a significantly simpler entrée to the