Commission pushes for 'responsible lending' by banks

Internal Market Commissioner Charlie McCreevy said: "The financial crisis has shown the damage that irresponsible lending and borrowing practices can have on consumers, lenders, the financial system and the economy at large. We are therefore determined to learn from possible mistakes to ensure that lending and borrowing take places in a responsible manner," he said in a statement.

Eurofinas, which represents specialised consumer credit providers, commented: "A key benefit in facilitating cross-border access to credit databases lies in improving access to finance for some categories of applicant borrower who are more difficult to assess, such as migrants and individuals who wish to buy a second home abroad."

In welcoming the report on credit histories, however, Eurofinas noted "that some lenders currently face unjustifiable difficulties accessing some databases," and therefore called on the European Commission "to ensure that member states transpose this provision properly and in a consistent manner".

The European Mortgage Federation (EMF) has recently released a draft list of standards for responsible lendind for home loans, aimed "at reinforcing the industry's commitment to existing practices". In addition, the EMF considers that "with regard to mortgage lending practices, the Commission should have drawn the distinction between the strict and responsible lending practices widely in use in the EU and those in evidence in the US which led in the end to the crisis in its sub-prime markets. While it is evident that strong improvements in lending practices are clearly necessary in the US, the EMF believes that the situation in the EU is not at all comparable", reads a statement.

Consumer associations took an opposite line. BEUC, representing European consumers, raised doubts about sharing credit databases. "The current crisis proved that the effects of databases on consumers' data and technologies based on such databases did not result necessarily in a more responsible credit and financial market. Such databases still need further and independent work, including on their desirability, proportionality and effectiveness, especially prior to their proliferation at cross-border level," reads a statement.

BEUC opposed the idea of shared registers due to privacy concerns. "The report does not provide the necessary restrictions/guarantees to protect consumers' personal data and right to privacy against a growing collection and aggregation of personal data and use of profiling techniques by the private sector," read its statement.