Banking Act (Consumer Credit) Regulations, 2025

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 21,540, 18 ta’ Novembru, 2025

L.N. 265 of 2025

BANKING ACT

(CAP. 371)

Banking Act (Consumer Credit) Regulations, 2025

IN EXERCISE of the powers conferred by article 3 of the

Banking Act, the Minister responsible for the regulation of financial

services, acting on the advice of the Malta Financial Services

Authority, has made the following regulations:-

(1) The title of these regulations is the Banking Act Citation and

scope.

(Consumer Credit) Regulations, 2025.

(2) The scope of these regulations is to apply the relevant

provisions of the Directive 2008/48/EC of the European Parliament

and of the Council of 23 April 2008 on credit agreements for

consumers and repealing Council Directive 87/102/EEC, in so far as

applicable to creditors as herein defined, and these regulations and any

Rules made thereunder shall be interpreted and applied accordingly.

(3) These regulations establish a common framework for

certain aspects of laws, regulations and administrative provisions

concerning credit agreements covering credit for consumers falling

within the scope of these regulations in accordance with regulation 4.

(4) These regulations shall come into force on such a date or

dates as the Minister responsible for finance may by notice in the

Gazette establish and different dates may be so established for different

provisions and, or purposes of these regulations.

(1)

In these regulations, unless the context otherwise Interpretation.

requires

"Act" means the Banking Act;

''Authority'' shall have the same meaning as assigned to it in

the Malta Financial Services Authority Act;

"consumer" shall have the same meaning as assigned to the

term "Client" in the Rules insofar as applicable to credit

agreements as defined herein;

"Consumer Credit Directive" means Directive 2008/48/EC

of the European Parliament and of the Council of 23 April 2008

on credit agreements for consumers and repealing Council

Directive 87/102/EEC, as may be amended from time to time;

"creditor" means a company that holds a credit institution

licence issued by the Authority in accordance with article 7 of

the Act, by virtue of which it is licensed or authorised to grant, or

promise to grant credit;

"credit agreement" means an agreement whereby a creditor

grants or promises to grant to a consumer credit in the form of a

deferred payment, loan or other similar financial

accommodation, except for agreements for the provision on a

continuing basis of services or for the supply of goods of the

same kind, where the consumer pays for such services or goods

for the duration of their provision by means of instalments;

"credit intermediary" means a natural or legal person who

is not acting as a creditor and who, in the course of his trade,

business or profession, for a fee, which may take a pecuniary

form or any other agreed form of financial consideration

(a) presents

or

offers

credit

agreements

to

consumers;

(b) assists consumers by undertaking preparatory

work in respect of credit agreements other than as referred

to in paragraph (a); or

(c) concludes credit agreements with consumers on

behalf of the creditor;

"European creditor" means a credit institution which is

authorised in another Member State in accordance with the CRD

and which has exercised its right to establish a branch or to

provide services in Malta in accordance with the CRD;

"Financial Services Tribunal" means the tribunal

established by article 21 of the Malta Financial Services

Authority Act;

"Member State" shall have the same meaning as assigned to

it in the Act;

"overdraft facility" means an explicit credit agreement

whereby a creditor makes available to a consumer, funds which

exceed the current balance in the current account of the

consumer;

"overrunning" means a tacitly accepted overdraft whereby

a creditor makes available to a consumer, funds which exceed the

current balance in the consumer’s current account or the agreed

overdraft facility;

"Rules" means the Conduct of Business Rules which may

be issued by the Authority in accordance with article 4 of the

Act;

"total amount of credit" means the ceiling or the total sums

made available under a credit agreement.

(2) Words and expressions used in these regulations which are

also used in the Consumer Credit Directive and, or the Act, but which

are not defined herein, shall have the same meaning assigned to them

in the said Directive and the Act.

(1) The Authority established by the Malta Financial Competent

Services Authority Act shall be the designated competent authority in authority.

Malta responsible for the implementation of the Consumer Credit

Directive, insofar as applicable to credit institutions duly licensed by

the same.

(2) The Authority shall, with respect to credit agreements

marketed, distributed or sold in or from Malta, monitor the compliance

of creditors and credit intermediaries with the provisions of these

regulations and the Rules made thereunder.

(3) For the better implementation of the Consumer Credit

Directive, the Authority may exercise any of the powers assigned to it

under the Act.

(4) For the better carrying out of these regulations, the

Authority may, from time to time, issue and publish Conduct of

Business Rules, in accordance with article 4 of the Act, and such Rules

shall be binding on creditors and other persons as may be specified

therein.

(1) These regulations shall apply to credit agreements Applicability.

covering credit for consumers insofar as the said credit agreements are

granted or promised to be granted by creditors as defined in these

regulations, and such regulations shall be read in conjunction with the

Rules issued thereunder.

(2) Without prejudice to sub-regulation (1), these regulations Exemptions.

and the Rules made thereunder shall not apply to credit agreements

(a) entered into before 1 October 2010, unless they are

open-end credit agreements;

(b) which are secured by a hypothec, privilege, or land

registry charge, or by a right related to immovable property;

(c) the purpose of which is to acquire or retain property

rights over land and or over an existing or projected building;

(d) involving a total amount of credit less than two

hundred euro (€200) or more than seventy-five thousand euro

(€75,000)

Provided that notwithstanding this provision, these

regulations shall apply to unsecured credit agreements the

purpose of which is the renovation of a residential immovable

property involving a total amount of credit above seventy-five

thousand euro (€75,000);

(e) relating to hiring or leasing where an obligation to

purchase the object of the agreement is not stipulated either by

the agreement itself or by a separate if it is so decided

unilaterally by the creditor;

(f) in the form of an overdraft facility and where the

credit has to be repaid within one (1) month, provided that this is

without prejudice to any requirements established in the Rules

for such an overdraft facility;

(g) where the credit is granted free of interest and

without any other charges;

(h) under the terms of which the credit has to be repaid

within three (3) months and only insignificant charges are

payable;

(i) where the credit is granted by an employer to his

employees as a secondary activity free of interest or at annual

percentage rates of charge which are lower than those prevailing

on the market, and which are not offered to the public;

(j) which are concluded with European investment firms

as defined in article 2 of the Investment Services Act or with

credit institutions or electronic money institutions as defined in

article 2 of the Act for the purpose of allowing an investor to

carry out a transaction relating to one or more of the instruments

listed in the Second Schedule to the Investment Services Act,

where the European investment firm or credit institution or

electronic money institution granting the credit is involved in

such transaction;

(k) which are the outcome of a settlement reached in

court or before another statutory authority;

(l) which relate to the deferred payment, free of charge,

of an existing debt;

(m) upon the conclusion of which the consumer is

requested to deposit an item as security in the creditor’s safe-

keeping and where the liability of the consumer is strictly limited

to that pledged item; and

(n) which relate to loans granted to a restricted public

under a statutory provision with a general interest purpose and at

lower interest rates than those prevailing on the market or free of

interest or on other terms which are more favourable to the

consumer than those prevailing on the market and at interest

rates not higher than those prevailing on the market.

(1) A creditor shall take all the necessary steps to ensure Obligation to

full compliance with these regulations and any Rules issued comply

regulations.

thereunder.

(2) Unless otherwise provided in these regulations and, or the

Rules, the obligations of the creditor shall equally apply to a European

creditor, and a credit intermediary where a credit intermediary presents

or offers credit agreements to consumers, assists consumers by

undertaking preparatory work in respect of credit agreements, or

concludes credit agreements with consumers on behalf of the creditor.

(1) A European creditor who intends to or has entered Database

into a credit agreement with a consumer in Malta, shall have access access.

under the conditions as a creditor based in Malta, to the databases

which are available in Malta in order to assess the creditworthiness of

the consumer

Provided that a request by a creditor or a European creditor

for access to the said database shall not be conditioned in a

discriminatory manner but may be refused by the holder of the

database if the information to be provided is prohibited by any other

law or is contrary to the public policy or public security of Malta.

(2) If the credit application is rejected on the basis of

consultation of a database, the creditor shall inform the consumer

immediately and without charge of the result of such consultation and

of the particulars of the database consulted.

(3) This regulation is without prejudice to the application of

Regulation (EU) 2016/679 of the European Parliament and of the

Council of 27 April 2016 on the protection of natural persons with

regard to the processing of personal data and on the free movement of

such data, and repealing Directive 95/46/EC (General Data Protection

Regulation) and the Data Protection Act, as applicable.

(1) Without prejudice to any other power assigned to the

Authority under the Act, these regulations or any other law, where a

person falling within the scope of these regulations, fails to comply

with any of the provisions of these regulations or any Rules issued

thereunder which further implement these regulations, the Authority

may, by notice in writing impose on such person an administrative

penalty and other administrative measures in accordance with articles

35A and 35B of the Act, as applicable.

(2) A right of appeal to the Financial Services Tribunal shall lie

from the decisions which the Authority shall take under these

regulations and the provisions of article 10 of the Act shall apply

mutatis mutandis.

(1) The provisions of these regulations shall prevail and

apply notwithstanding anything to the contrary contained in any credit

agreement entered into by the consumer.

(2) Any waiver by the consumer of any of the rights granted to

him by these regulations shall be null and void.

(3) The provisions of these regulations shall not be

circumvented as a result of the way in which agreements are

formulated, in particular by integrating drawdowns or credit

agreements falling within the scope of these regulations into credit

agreements, the character or purpose of which would make it possible

to avoid its application.

(4) Notwithstanding any provision in the credit agreement to

the effect that the applicable law to the credit agreement shall be the

law of a country which is not a Member State, the protection granted

by these regulations shall continue to apply where the credit agreement

has a close link with the territory of Malta or of any other Member

State.

€0.27