AFM: providers must investigate whether customers can pay the subscription from May

The financial regulator AFM has announced that from May, providers must check whether customers can pay for this when selling a telephone subscription. For example, customers must state their income with a telephone credit of 250 euros or higher.

According to the regulator, providers must perform a loan test, in addition to a test at the Credit Registration Bureau, or BKR. In addition, taking out a subscription whereby a telephone credit of at least 250 euros is provided results in a registration with the BKR, which can affect the amount that consumers can borrow.

Minister of Finance Jeroen Dijsselbloem already announced in April that new rules would apply to providers. As part of this, providers must include the message ‘Caution! Borrowing money costs money using ‘and showing a credit table. These rules came into effect on 1 January, which must be visible in advertisements and on websites, the AFM reports. The tables show what the actual costs of a loan are.

The mobile subscriptions are supervised by the AFM, because the providers and the minister were unable to agree on their own code of conduct last year. If that had happened, supervision would be exercised by the Preventel foundation. The new situation is the result of a 2014 Supreme Court ruling, in which it determined that purchasing a subscription with a ‘free’ telephone is in fact an installment purchase.

The ruling also led to the ConsumerClaim organization suing various providers, because customers allegedly paid too much for their all-in subscriptions. The organization wants the customers to get back the overpaid amount, which is possible according to another decision of the Supreme Court.