Dutch MP hails CRUKS as blueprint to tackling consumer debt

The Dutch government is facing calls to enter discussions with the financial sector for the development of a consumer credit self-exclusion system similar to the CRUKS registry. 

Media outlet Casinonieuws reported that Don Ceder, a Dutch MP from the ChristenUnie party, put forward a motion in which he praised the effectiveness of the Central Register for Exclusion from Gambling (CRUKS).

In his statement, Ceder argued that the model could potentially find success by being translated into other fields dealing with consumer finances as well, specifically the credit, loans and instalment payments (BNPL) sector.

BNPL in particular has gained widespread popularity across Europe in recent years, essentially serving as a small scale consumer credit that allows for everyday goods to be purchased and then paid over a certain period of time – with the relevant BNPL lender company acting as a borrower.

Klarna, a Sweden-based fintech company, is widely believed to be the trendsetter and main actor behind BNPL’s spread in Europe, currently holding a significant share of the market in the region. 

In its early days of adoption, BNPL was generally viewed as a positive addition to the available payment options due to its accessibility, usual interest-free instalments and overall convenience. 

However, in recent times there has been a growing number of critics opposing the use of BNPL, with insufficient regulations and overlending often being put forward as the central arguments against it.

Some EU countries, including the Netherlands, have even called on BNPL providers to scale back the service’s rollout into physical stores until clearer consumer protection frameworks are adopted.

This is where Ceder’s motion comes into play, outlining that CRUKS already provides an appropriate foundation to build such a framework on.

The proposal was turned down during the latest Dutch plenary session. Teun Struycken, State Secretary for Legal Protections, commented that the Kamer’s priority with the Ministry of Finance currently lies in the adoption of the revised European Consumer Credit Directive (CCD II).

This however will most likely not be the final resting place of the motion, with Struycken asking Ceder to re-formulate his proposal in a way that relieves the government of the responsibility for establishing such a registry – instead giving it a more advisory role in a matter that the Legal State Secretary believes should be handled by the financial sector itself.