Bulgarians Urged to Watch Exchange Rate Amid Euro Adoption and Loan Concerns

The adoption of the euro in Bulgaria is not expected to cause fast loans to become more expensive, and borrowers already have the tools to track and understand how their loans will be repaid after the currency transition.

The Association for Responsible Non-Bank Lending has issued several recommendations for consumers. At the top of the list is a reminder to rely solely on the official exchange rate of the Bulgarian National Bank (BNB) when recalculating amounts, rather than trusting third-party or unofficial rates. Many non-bank lenders have already integrated automatic calculators into their systems, which allow borrowers to see how their loans will convert using the BNB's fixed rate.

Roughly one in four Bulgarians has taken out a fast loan at least once. However, the association does not anticipate a spike in borrowing. These loans are typically used for manageable short-term needs - home repairs, vacations, or electronics purchases - rather than major financial commitments.

Nikolay Tsvetanov, chairman of the association, emphasized on Nova TV that the cost of these loans is capped by the Consumer Protection Act, which ties the maximum cost to a percentage of the principal. This means the cost limit remains unchanged regardless of whether amounts are expressed in leva or euros.

He underlined that there’s no financial basis for lenders to increase interest rates simply because of the euro’s introduction. Should any company attempt to do so under false pretenses, it would be in violation of the law and subject to sanctions.

Source: Nova TV