ACM fines seven pawnshops for exceeding the maximum interest rate

The Netherlands Authority for Consumers and Markets (ACM) has imposed fines totaling EUR 437,500 on seven pawnshops belonging to franchise chain Cash Converters. The pawnshops charged consumers an interest rate of 9 percent per month, while they are not allowed to charge more than 4,5 percent a month. The pawnshops concerned are: Cash Converters Den Haag B.V., Cash Converters Arnhem B.V., Cash Converters Enschede B.V., Cash Converters Rotterdam-Centrum B.V., Cash Converters Rotterdam-Zuid B.V., Cash Converters Schiedam B.V. and Cash Converters Utrecht B.V.

Henk Don, Member of the Board of ACM, explains: “These fines are a clear signal from ACM to the pawnshop sector. Consumers that have decided to use items as collateral for cash must not be confronted with high fees.”

Consumers in need of cash can take items to a pawnshop, who will keep these items. In return, consumers receive cash. If they want to reclaim their items, they have to repay the amount of money they received, plus an interest fee. Since July 1, 2015, the maximum interest rate is 4,5 percent per month. Pawnshops are not allowed to charge any other additional fees.