Brussels does not initiate proceedings against baby loan


Instantly, the country was rumored to announce that the European Commission would like to get involved in the conditions for baby-sitting. We went after him, so he really is and how it can affect your credit application.

Promised not to initiate proceedings against the baby to be credit


According to the announcement at the MTI, the European Commission has given an oral pledge to the Hungarian government that it will not initiate proceedings against the baby boomers, which will begin on July 1. This means that the elements of this year heralded the Family Protection Action Plan will start at the same time.

The conditions applying to individuals remain unchanged


According to the proposal of the European Commission’s Directorate-General for Competition, the 100% guarantee and interest rate subsidy would be reduced to 80%, which would enhance market competition between banks. The proposal is without prejudice to individuals applying for credit and the conditions applying to them, only banks that start with a baby loan.

It means that:

  • the same will be interest-free loan if your child is born five years after the credit application,

  • just point to stop three years of repayment, if the children are born,

  • just released the state 30 percent of the outstanding loan debt if, after the birth of the second child of the application,

  • and release the rest of the state outstanding debt if the third child is born.

But then what would the European Commission want?


In short, more competition between banks and no suspicion of state aid at the bank level. During months of trade talks, the Hungarian side raised the issue of interest rate cuts as a solution to competition concerns. The response from the Brussels committee was that “a 100% guarantee would make the scheme as risky for the bank as it would buy government securities,” it was said at a telephone conference between the two parties.

Reducing the amount of the guarantee and interest rate subsidy would eliminate the competitive advantage at the bank level and would eliminate “later concerns about the state aid rules”, as stated in the European Commission Communication.

It is important to clarify that the European Commission has so far made only suggestions, so there is no official investigation or resolution. The technical discussions will continue between the two sides, so can not talk about the attack on behalf of the organization in Brussels. In fact, several stressed releases that expresses the happy baby waiting program.

Rosencrantz’s position: The European Commission’s proposal will not affect the conditions applicable to individuals and would not be detrimental if the proposal were to amend the Baby Loans Regulation. Any change – reducing the level of the State guarantee – would mean a change for the banks, as they would be able to achieve lower interest margins and profits.


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