For the model used to calculate the maximum amount of credit in the Caribbean Netherlands (“berekening maximale krediet BES”), what has to be entered for the current monthly financial expense if the customer has a credit card?

If a customer has a credit card, the AFM recommended until recently that, for calculating the size of responsible credit, an amount based on repaying the balance by the annuity method over a period not exceeding five years should be taken into account. We understand that in practice most credit card balances now have to be repaid within two years.

This stricter requirement ensures that the interests of customers are given more weight. The AFM is therefore changing its recommendation and is advising that a maximum repayment term of two years will be used for a credit card.

The amount to be used in the calculation should be at least 5% of the maximum that can be taken out on the card.

If the agreement specifies a higher repayment percentage for the customer, this higher figure has to be used in the calculation. After all, this is the customer’s actual monthly expense. If the agreement with the customer permits monthly repayments of less than 5%, the AFM nevertheless recommends using 5% in the calculation.

If the credit provider does not follow this method, the company is running the risk of the customer borrowing more than is responsible.

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