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FinTechs belonging to this category act as a loan creditor (even short and very short-term loans), are broking loans or receivables or conduct factoring of loans, which were given to private or business customers. In this business area you also find “peer-to-peer” (P2P) services, in which FinTechs enable a multitude of users to give loans (and brokered by the FinTech-platform) to other users or companies.
Finetrading is hereby a financial service of FinTechs, where they buy due receivables and grant the debtor an extension of payment time.
As an ancillary service some FinTechs offer alternative credit assessment services to check the solvency of a borrower.
Introduction
Attitude of the country towards loan-giving-, factoring-, brokerage-, finetrading- and ancillary services
This part of FinTech is present in Croatia and continues its development.
Legal affairs
Obligations and requirements to provide loan-giving-, factoring-, brokerage-, finetrading, and ancillary services described above
According to Croatian law, loans may be provided by credit institutions (banks, savings banks, and housing savings banks) or credit unions (subject to being a member thereof). To be able to grant loans, such institutions require prior authorisation by the CNB.
The Consumer Loan Act (CLA) prescribes that credit intermediaries must also obtain appropriate authorisation by the CNB (provided for the period of three (3) years). The information on specific services and credit institutions, for which a credit intermediary can act, is available on the website of the CNB in the register of credit intermediaries.
Additionally, loans may also be provided by the creditors having an authorisation of the Ministry of Finance which also publishes the list of creditors holding an authorisation to grant consumer loans.
In addition, Croatia’s accession to the EU has opened new possibilities for negotiating a loan so it is now possible to negotiate a loan with institutions authorised in other Member State showing interest for direct or indirect provision of services in the territory of Croatia. In principle, such institutions do not require a special authorisation since they are already authorised in the countries in which they have a registered office, but they are obligated to announce their intention to provide services in the territory of Croatia. In any case, the licensing requirements would need to be addressed on a case-by-case basis and may depend on several factors (including whether the loans are provided in the territory of Croatia, whether or not the loans were granted on a reverse inquiry basis and similar).
Where a loan is negotiated with entities not belonging to either of the previously mentioned categories, it is necessary to bear in mind that such entities are not regulated or supervised and that in regard to credit price and terms and conditions they are less favourable than those offered by regulated institutions.
Moreover, for providing factoring services, the Factoring Act (FA) prescribes that the factoring companies have to obtain an approval from HANFA for provision of factoring services. Such approval (granted for indefinite time period) has to be obtained before the relevant entry is recorded in the court register.
Additional comments regarding the legal situation for loan-giving-, factoring-, brokerage, finetrading-, and ancillary services or what FinTech’s must be aware of in this business area
N/A.
Economic conditions
Market size for loan-giving-, factoring-, brokerage-, finetrading- and ancillary services and biggest companies in this business area
According to the official register of factoring companies by HANFA, there are only f