Greece is introducing a new regulatory cap on the total cost of consumer loans and credit cards—aimed at curbing runaway debt for thousands of borrowers. A draft bill by the Ministry of Development (YPAN) will enter public consultation this month, setting a ceiling on interest and fees for unsecured consumer loans up to €100,000. The measure responds to growing concerns over cases where total repayment—including interest, commissions, and ancillary charges—exceeds the original loan amount, sometimes dramatically.
A Step Toward EU Alignment and Consumer Protection
The reform brings Greece in line with broader European Union directives on responsible lending and transparency. It targets opaque contract terms—often buried in fine print—that borrowers may not fully understand, while also introducing a 14-day right of withdrawal after loan agreement. Greater clarity in loan contracts and stricter limits on predatory practices are central pillars of the proposal.
How the Cap Works
Under the draft law, the total cost of a consumer loan—including interest, fees, and other charges—will be limited to between 30% and 50% above the principal amount borrowed. This cap applies only to new unsecured loans up to €100,000 and will not apply retroactively.
For context: current annual interest rates on consumer loans and credit cards range between 9% and 15%. These rates are expected to adjust downward to ensure compliance with the new cost ceiling.
Real-World Examples
Example 1: A €15,000 loan with a 40% cost cap means the borrower’s total repayment—including interest, processing fees, and commissions—cannot exceed €19,500 over the life of the loan.
Example 2: A €10,000 loan at 10% annual interest, compounded yearly, would grow to €13,310 after three years without any cap. But under a 30% cap, the maximum total obligation—including all charges—would be €13,000. Under a 50% cap, it would top out at €15,000.
This means the borrower’s maximum additional burden would range from €3,000 (30%) to €5,000 (50%), keeping the final debt strictly within those bounds.
Broader Context
As of end-March, outstanding consumer loan balances stood at €8.5 billion. Lending activity continues to expand: in Q1 2026, 94,000 borrowers took out €385 million in new consumer loans, according to data from the Hellenic Statistical Authority (ELSTAT). The new rules aim to protect vulnerable households—particularly those lacking the capacity to service escalating debt—while encouraging more sustainable borrowing practices across the financial system.