Changes in consumer bankruptcy will have negative impact

The adoption of the latest version of the Bankruptcy Act currently under preparation by the Justice Ministry will lead to increased moral hazard behavior among consumers, such as incurring liabilities without feeling that they will have to be repaid, Conference of Financial Enterprises in Poland (KPF) stated. The most controversial of the changes proposes to free debtors from the obligation to prove that they took loans or any other liabilities in good faith.

Meanwhile, a recent survey shows that as many as 43.2 percent of respondents fear that the loosening of consumer bankruptcy conditions will cause an increase in the cost of borrowing, as well as higher costs of non-financial services. In turn, 38 percent of them indicated that the new solution would encourage consumers to take loans at significantly higher amounts than before.

(ISBnews)