France set to change Consumer Credit Rules to curb over-indebtedness.

Sept 2025 : France has decided to implement a change in the Consumer credit regulations from the beginning of 2026. While the increase in small loans tends to encourage over-indebtedness, an order of September 03, 2025, harmonises French regulations with those of Europe, which are more protective of borrowers. The order of September 3, 2025 allows the transposition into French law of European Directive (EU) 2023/2225.

The new rules applicable to consumer credit contracts will come into force on 20^th. November 2026 to allow the professionals concerned to adapt their clauses and contracts. The objective is to prevent over-indebtedness by regulating borrowing practices, particularly for small, short-term loans or loans easily accessible via the internet.

The new regulations apply to several types of credit that were previously partially or totally excluded:

• credits without any fees or interest, known as “free credits” (or with fees of a negligible amount);
• credits of less than €200, known as “mini-credits”;
• short-term loans, less than 3 months with negligible fees (split or deferred payment);
• consumer credits from €75,000 to €100,000;
• lease contracts with purchase option (LOA).

However, the French Government has decided to exempt Deferred debit cards from the regulations.

Protection measures for the consumers –

Borrowing practices will be more regulated through various key measures.

More regulated advertising:

• Any communication relating to a consumer credit transaction must be “clear, fair and not misleading”.
• It must include the words “Warning! Credit costs money and must be repaid!”
• Highlighting the ease of obtaining credit will be prohibited.

Simplification and transparency:

• Formalities for short-term or small-value loans will be simplified, while ensuring transparency.
• The pre-contractual information provided by the lending institution will be more regulated.

Analysis of the borrower’s solvency:

Financial institutions will be able to consult, on an optional basis, the national database of repayment incidents to analyze the solvency of borrowers, even for small loans. They will be able to alert consumers in the event of financial difficulties.

Other protective provisions:

• Free referral of clients in difficulty to debt counseling services.
• Borrower withdrawal periods extended in the event of the lender’s failure to comply with its contractual information obligations.
• Preferential conditions in the event of early repayment.

The order of September 03, 2025 is issued pursuant to the law of April 30, 2025 containing various provisions for adaptation to European Union law in economic, financial, environmental, energy, transport, health and movement of people matters.

Team Maverick