Indexation to be abolished from 2016
Sigmundur Davíð Gunnlaugsson, Prime Minister of Iceland Photo/Eggert Jóhannesson
“A majority within the expert group on the abolition of indexation on new consumer loans has recommended that full abolition should begin no later than 2016, when experience has been gained from the changes that the group has recommended for the first phase.”
This was the response of the Icelandic Prime Minister, Sigmundur Davíð Gunnlaugsson, to a written question from Sigríður Ingibjörg Ingadóttir, MP for the Social Democratic Alliance, regarding the planned timetable for full abolition of indexation on consumer loans. The PM’s full reply (in Icelandic) can be seen here.
The first stage will see a ban on offering consumers indexed loans repaid in equal instalments of longer than 25 years, an extension of the minimum loan period for new indexed consumer loans to ten years, restrictions on indexed mortgages, and further incentives for non-indexed loans.
