ECONOMY

EKPOIZO berates banks

The consumer organization EKPOIZO yesterday charged the banking sector with misleading the public on lending conditions, partly contributing to the fact that one in three of the working population is indebted to banks. Citing an ICAP survey conducted on behalf of the Bank of Greece and due to be publicized by the central bank today, Eleni Goulielmou, head of EKPOIZO, said 1.26 million, or a third of the working population, have taken out bank loans in order to satisfy their daily basic needs. Of this, 252,000, or 20 percent, are having difficulty paying off their loans, while 63,000, or 5 percent, are two to six months in arrears on their payments. The consumer credit boom is rooted in part in «intensive and misleading advertising by banks targeting the public and, in some cases, making it seem like houses can be acquired for free,» Goulielmou said. Greeks were in effect «mortgaging away their future income,» she stressed. She said the rising level of debt not only poses problems for debtors but could also boomerang on the financial sector and on the economy in the future. Goulielmou also slammed local banks for not implementing a Supreme Court decision issued a year and a half ago which found certain terms in consumer loan and credit card contracts to be illegal and improper. One prime example of the sector’s disregard for the verdict is Alpha Bank’s recent decision to jack up interest rates for certain loan categories unilaterally. EKPOIZO has challenged the move by filing a collective action lawsuit against the bank. It is also seeking 8 million euros for moral injury to the public. A hearing is due on March 17. The association also urged consumers to refrain from using credit cards or taking out bank loans for the period March 17-22 in honor of World Consumer Day on Saturday as well as in support of its collective action lawsuit against Alpha Bank.