New procedure regarding credit checks
The Danish FSA has, in collaboration with the consumer ombudsman, put forth new demands and advice for customer protection regarding loans and leasing demands.
Background for new credit checks
The Danish FSA has put forth new demands regarding credit checks. The way a customer gets credit checked, will be changed. The changes are made to protect customers, and to ensure that they do not obtain loans/leasing that puts them in a poor financial decision. The new demands obligates all financial institutions.
If you would like to read more about the background of the new changes, you can read about it in 'Finanstilsynets og Forbrugerombudsmanden Vejledning om kræditværdighedsvurdering' of 2021.
1. Changed procedure regarding credit checks
- The Danish FSA has, in collaboration with the consumer ombudsman, put forth new demands and advice for customer protection regarding loans and leasing demands.
- In that regard, LeasePlan is obligated to change the procedure when running credit checks on customers, in accordance with the Danish FSA and the consumer ombudsman's new guidelines for credit checks.
- The guidelines primarily focus on one's allowance, and takes its roots in the Debt Relief Order (nr. 2187). LeasePlan must therefore gather a well documented budget via eSkat and PSD2 (bank transactions). It is possible for customers to make changes in this, as long as the changes are documented.
2. Collecting data via Noitso
- The credit check is made in collaboration with Noitso, who gathers data on behalf of LeasePlan, that draws up a budget the credit check is based on.
- Noitso gathers, with permission from the customer, income from eSkat data. eSkat data is based on all registered income of the customer, and is thereby based on what the customer's employer, or customers itself, has informed Skat.
- Noitso gathers, with permission from the customer, expenses via PSD2 (bank transactions). In that regard, all expenses are drawn from what is classified by the customer's bank. Please note, that neither LeasePlan nor Noitso gathers information on purchase patterns, or information regarding the daily variable expense.
3. Calculation of total budget
- Noitso calculates and draws up a complete budget on behalf of the gathered data, which is then presented to LeasePlan's credit department. The credit department will from here do a credit check in accordance with the guidelines presented by the Danish FSA and the consumer ombudsman. In some cases, LeasePlan may need additional documentation in order to make a fair and honest credit check. Besides, it may be that the customer will need a co-creditor in order to accept the customer's credit.
- If the customer can present a co-creditor in the form of partner, both parties' economy will be checked. This happens in accordance with the above mentioned demands.
- If the customer presents a co-creditor that is not a partner, the co-creditor will be credit checked as a sole leaser in accordance with the above mentioned demands.