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Consumers in Finland increasingly having trouble paying bills

Finland does not have a comprehensive consumer credit rating system which could prevent at-risk people from applying for too much credit.

File photo. Image: AOP

Finnish financial data services firm Suomen Asiakastieto reports that people with problems paying bills in the company's register each received an average of about 15 payment arrears notices last year. People with difficulties paying their bills have often defaulted on payments in the past.

The firm said that this year's tally of bill non-payment warnings was roughly the same as last year.

In 2017 there were 1.65 million cases of bill payment defaults reported to Asiakastieto, an increase of about one-tenth from the previous year.

The firm says that one of the reasons for the increase may be that creditors do not have adequate information about people's incomes and credit histories.

No centralised credit rating system in Finland

Finland does not have a comprehensive credit checking system which takes into account all loans and income data — only Asiakastieto's payment default register.

This situation means that people who are swamped in paying back loans — but still have not yet received a non-payment warning via a creditor — are still able to take out new loans and increase the amount of debt they'll eventually face.

Asiakastieto's director of consumer information Jouni Muhonen said the problem is an acute one.

"But making new legislation to create a new credit registry from the ground up could take years. That's why we should improve the scope of the current system in order to improve the sharing of credit data between different parties," Muhonen said.

"Creditors need access to all information about a person's income and debt in order to make a responsible decision about approving a loan," he said.

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