Loan loan shark: what it is and when it is defined as such
Usury is a rather ancient type of loan and, in general, people with great economic difficulties, often traders or entrepreneurs, who are prevented from obtaining the sum of money, are excluded from this form of illegal financing. they need, from lenders.
Who are the moneylenders?
Often moneylenders, who are commonly referred to as loan sharks, are subjects who have large sums of money, these can derive from the proceeds of an illegal activity (earnings in black or money laundered), from the earnings of a well-paid legal activity that, at the same time, allows you to get in touch with numerous people (lawyers, accountants, etc.) or financial resources linked to being born into a particularly wealthy family.
The usurer is not a legally recognized profession. Furthermore, the legislation of our country, but also of many nations of the European Union, is characterized by an anti-usury law, which defines the interest rate above which a loan can be defined as a throttle or, in fact, usury.
The law in question is the number 108 of 7 March 1996 with which usury is defined as any loan whose interest rates are higher than the Average Global Effective Rate, which is defined on a quarterly basis by the UIC, established at the Best bank.
Italian legislation establishes the nullity of any contract that meets the typical requirements of usury, therefore none of the clauses included in it has validity.
When can we talk about wear?
Usury is defined as the loan of a sum of money which provides for a repayment characterized by interest rates that exceed the Average Global Effective Rate established by the Bank of Italy, on behalf of the Ministry of Economy and Finance.
The TEGM is defined every three months and serves to indicate the value of the rates that the institutions, which legally grant loans, must take as a reference.
Any rate that is a quarter higher than that set by the Bank of Italy, can be defined as usurious.
The tables to be taken as reference are published in the Official Journal, on the Bank’s websites and on the Ministry’s websites. Taxes and duties are excluded from the calculation of the average interest.
For example, if the maximum rate that can be applied by credit institutions is 9.33%, any rate higher than 11.66% will be considered usury, to which it is possible to add a margin of another 4 percentage points (15, 66%).
Usury in Italy
According to data collected by Eurispes in 2015, around 50 thousand moneylenders are active in Italy.
In recent years, however, there has been a significant and worrying change regarding the type of people who access this form of loan. In fact, if in the past usury mainly involved entrepreneurs or traders, currently (based on the complaints collected) the subjects who turn to loan sharks in an attempt to find a solution to financial problems, are employees. In fact, 52% of usury victims have a fixed income, but are forced to live on just over 200 USD a month. The reason for this phenomenon is linked to the fact that employees often enter into more than two loan agreements with credit institutions (paying high interest), thus making the management of daily expenses difficult. When borrowing a sum of money, its return is always characterized by a surcharge linked to the payment of interest. When the interest rates are so high as to be defined illegal and to make the repayment of the loan almost impossible, we speak of usury.