On 23 September 2026, the Bulgarian Parliament adopted the draft new Consumer Credit Act implementing Directive (EU) 2023/2225 (CCD II). Submitted by the Council of Ministers on 11 September 2026, the bill would replace the existing Consumer Credit Act, which has been in force since 2010 implementing the original CCD I, and introduces significant changes for lenders, credit intermediaries and retailers offering consumer finance.
Broader scope including "buy now, pay later"
The bill covers consumer credit up to EUR 100,000, raising the current ceiling of EUR 75,000 with no minimum threshold. It also covers unsecured loans exceeding that amount for residential property renovation and brings interest-free and certain short-term credit arrangements within scope (excluded entirely under the existing Act) subject to limited exemptions from information requirements. The bill also applies to leases offering an option to purchase.
Many "buy now, pay later" products would become subject to consumer credit requirements. Certain supplier-provided deferred payments remain excluded where no third-party offers the credit, payment is completed within 50 days and no interest or charges apply other than limited late-payment charges. A stricter 14-day exemption applies to large suppliers concluding distance contracts online, provided no third party offers or purchases the credit.
Key requirements
The bill introduces or strengthens the following obligations:
- Mandatory warnings that borrowing costs money (not present in the current Act), revised pre-contractual information delivered through updated standard European forms, and a ban on misleading advertisements on credit or its costs;
- Credit may be granted only where the assessment indicates that the consumer can meet their obligations (the current obligation is to assess creditworthiness with a mandatory Central Credit Register check), and new restrictions have been introduced on using sensitive personal data and social media information;
- Rights to explanations, human intervention and reconsideration where creditworthiness assessments involve automated processing;
- New prohibitions not addressed in the current Act on pre-ticked consent boxes, unsolicited credit and unilateral increases in credit limits; and
- New procedures for early identification of repayment problems and appropriate forbearance before enforcement, including measures such as payment holidays, rate reductions and debt consolidation.
Separate cost caps for smaller loans
The draft retains the general annual percentage rate of charge (APR) ceiling of five times the statutory default interest rate, introduced into the current Act in 2014, but carves out loans of up to three national minimum monthly wages from that ceiling and subjects them to separate total-cost caps.
For those smaller loans, total credit costs would be capped at 20% of principal for repayment within one month, 30% for repayment over one month and up to three months and 100% for longer terms. These are total-cost caps, which is a new mechanism not present in the current Act, rather than annualised rates and would require affected lenders to review their pricing models.
New registration requirements
The Commission for Consumer Protection (CCP) would maintain new registers for consumer credit intermediaries and creditors. The current Act does not require registration or licensing for consumer credit intermediaries or non-bank creditors. Under the bill, intermediaries would face registration, competence and reputation requirements, with a simplified notification route for specified regulated institutions.
The creditor registration regime would exclude banks and branches licensed under the Credit Institutions Act, financial institutions already registered under Article 3a of that Act, and payment institutions and electronic money institutions providing credit under Article 21 of the Payment Services and Payment Systems Act (PSPSA). A further exemption would cover qualifying SME suppliers providing interest-free deferred payment for their own goods or services.
These exemptions concern registration, rather than a general exclusion from the Act's consumer protection requirements.
The draft also introduces significantly higher pecuniary penalties than the existing regime: up to EUR 60,000 for repeated breaches of specified registration and operating requirements. Certain failures to comply with mandatory pre-contractual disclosure or contractual requirements would render the credit agreement invalid, leaving the consumer liable only for principal without interest or other credit costs.
Timing and next steps
The draft provides for entry into force on 20 November 2026, generally applying to agreements concluded from that date, with specified provisions extending to existing open-ended agreements. It also provides a six-month period for creditors and intermediaries to align their activities, with existing operators subject to the new registration regimes required to apply within four months.
The bill remains subject to further parliamentary consideration. Ahead of its passage into law, businesses should assess product coverage, registration obligations, pricing and customer journeys against the proposed framework.
For more information on CCD II and consumer lending in Bulgaria, contact your CMS client partner or the CMS experts who contributed to this article.
Yana Docheva contributed to the article.
