Conditions that will deteriorate. Low interest rates and inflation have made European citizens more attractive conditions for getting loans for years. In Sweden, that's why National Bank (Riksbank) Interest Rates – Controls current lending rates offered by Swedish banks – not exceeding 0% at least from 2015 to early 2022. The war in Ukraine then began, forcing Riksbank to raise interest rates. Naturally, the bank continued its lawsuit. As a result, most Swedish households suddenly had significantly higher housing costs. This is driving more and more households In debt. The Swedes have the highest level of household debt in the EU, weighing around 42,000 euros per person. at the same time, Mortgage bank margins are increasing.
Joakim Söderberg, Data Protection Attorney Noub: “The main thing Swedish people are talking about now is the living crisis. Mortgages are the majority and perhaps even the biggest part. At the very least, banks need to comply with their obligations under the GDPR and be transparent about how they calculate their loans. Instead, they refuse to respect people's fundamental rights to data protection.”
Transparency required by law. The situation may be similar in other EU countries, but Sweden has a major problem. Banks tend to automate interest rates completely and set them without human intervention. This makes it difficult for consumers to learn more about how interest rates have turned out. For this exact reason, EU law requires that you follow strict transparency rules using automated decision-making. “Meaning information about the relevant logic” With calculations made by such a system. The reality is that banks can be creative to avoid obligations. For example, Swedbank has denied access requests for Swedish data subjects under Article 15 GDPR. “Commerce Secrets”.
But transparency is very important here. Because even small changes in interest rates can have serious consequences for consumers. An example to illustrate this is: If you have a 15-year loan of 300,000 euros with 4% interest, the monthly loan installment payment is 2,208 euros. If interest rates suddenly increase to 4.5%, your monthly payments will jump to 2,281 euros. It's 73 euros per month for 15 years or 13,140 euros in total
Joakim Söderberg, Data Protection Attorney Noub: “Banks erode the little trust that consumers still have by claiming that the logic behind the calculation of interest rates is trade secret. It raises doubts: if we don't know how we are actually being treated, how can we, as consumers, know that we are treated fairly?”
Essential trade secrets – it is actually defined in EU law. According to both Swedish and EU laws, information can only become trade secrets if its disclosure is likely to give an advantage to its competitors. But if the information is public, your competitors already know. This is the case for interest rates: mortgage lending transparency is regulated through the EU Mortgage Credit Directive, Literally included Equation for calculating mortgage fees. Furthermore, Swedish consumer credit law refers directly to the EU directive, saying that people have the right to know how their interest rates were calculated if the loan is based on a reference rate (such as the Riksbank policy rate) and if it is based on what the bank adds to that rate. This allows consumers to make informed choices about where they will lend their money, potentially correcting false or incomplete data that leads to higher interest rates.
Complaints filed in Sweden. Noub Therefore, it filed a complaint with the Swedish Data Protection Agency (IMY) and calls for a full investigation of Swedbank's decision to deny access requests for data subjects. To ensure that the petitioner effectively protects his rights, Noub IMY then proposes to order SwedBank to provide the data subject with full access to the logic used to calculate mortgage rates. Additionally, Swedbank must establish procedures to properly respond to future access requests. Finally, Noub We propose to impose administrative fines to prevent similar violations in the future.
