The Greek government is introducing legislation to strengthen consumer protection in retail banking by capping the total repayment amount on consumer loans of up to €100,000.
Prime Minister Kyriakos Mitsotakis announced the plan, emphasizing the need to curb abusive practices and fine print in lending contracts. Under the proposal, the total amount a borrower must repay-including interest and fees-will be capped at 30% to 50% above the principal, aligning with averages in other European countries.
The cap applies primarily to unsecured consumer loans and credit card debt, where high interest rates and complex fee structures have been prevalent. A 14-day cooling-off period from contract signing is also included to strengthen borrower rights and transparency.
This intervention comes as consumer credit in Greece recovers after years of contraction during the debt crisis. Demand has strengthened since 2022, but borrowing costs remain high: interest rates on consumer loans often exceed 10%, and revolving credit products like credit cards can surpass 14%.
The initiative is part of a broader government effort to address banking practices that burden consumers, including opaque fees, high costs for basic services, and limited competition. The government has also pressured banks to raise deposit rates, accusing them of being slow to pass benefits to savers. Greek banks have returned to stable profitability following consolidation and reduction of non-performing loans.