Norway’s conservative government coalition, alarmed by the growth of consumer debt in the country, followed through this week on plans to curb it. Three ministries acted together to present stricter regulations, establishment of a debt register and monthly billings that clearly show a customers’ total debt.
Finance Minister Siv Jensen is especially cracking down on what she calls the “aggressive” marketing of consumer loans and credit cards that encourage Norwegians to spend more money. Household consumer debt in Norway grew by 15 percent last year, currently totals an estimated NOK 90 billion and has more than doubled since 2008.
Now a new debt register that will allow banks to share information will be set up, aimed at preventing consumers from acquiring multiple consumer loans from various lenders. The lenders can at least be better informed about how much debt a prospective borrower already has.
The government stopped short, however, of prohibiting credit card companies from offering “bonus” and “loyalty” programs that reward consumers for charging more items. The head of Norway’s consumer council (Forbrukerrådet) was disappointed, claiming that would have greatly helped curb credit card growth.
Consumer advocates were, however, pleased with the measures to tackle rising debt levels, which follow the government’s earlier measures to rein in the growth of home mortgage debt in an era of low interest rates.