This research was carried out over a two-year period. After conducting a literature search, we analyzed the offers and application forms found on the websites of 21 companies offering credit cards and/or personal loans, seven companies offering 2nd and 3rd chance auto loans, and three companies offering payday loans.
We began by checking the presence, accessibility and clarity of the information consumers need to make an informed choice, both on offers and on forms. On the sites of companies offering credit cards and personal loans, eligibility conditions were not always announced a priori, and useful information was not always clear and accessible. On sites offering 2nd and 3rd chance car loans or payday loans, the situation was even worse. In fact, most of the time, relevant information was simply non-existent.
In such a context, it is difficult for the consumer to make an informed decision. We then made a list of the personal information requested, assessed whether it was necessary for the request, and noted the indications relating to the management of this information (with particular attention to privacy policies). In doing so, we realized that companies rarely ask for an inordinate amount of information not required to process the request, which is a good thing. On the other hand, many forms asked for the Social Insurance Number (SIN) (in many cases, the consumer was strongly encouraged to provide it, on the pretext that this information would speed up the processing of the request).
Such requests can be detrimental to the consumer. For their part, companies offering payday loans collect so little information that we wondered how they could make an informed decision about a consumer's eligibility. We also surveyed consumers in four focus groups. People who regularly surf the Internet were less concerned about online credit than other consumers. But they all seemed to attach little importance to the credit information they were given (often, they didn't even read it). We found this worrying. On the other hand, when we presented them with the information box (mandatory for online credit card offers), they thought it was well done and that the information it contained was important. This leads us to believe that the information box should also be mandatory for other types of online credit offers (with certain adjustments, of course).
Participants also found the forms easy to fill in. Because there isn't always enough information on Internet sites, and because consumers aren't inclined to read the information on them anyway, this ease of use had the effect of worrying us. It even leads us to wonder whether, in the current economic climate, it is possible to apply for credit online while being really well informed.
In terms of participants' perceptions of privacy policies, it's clear that all were aware of the existence of such documents. On the other hand, the vast majority of participants did not know what this type of document contained. For the most part, participants believed that privacy policies ensured the protection of their personal information (i.e. that it would not be shared, disseminated or used for any purpose other than that for which it was provided). The participants were all shocked to learn that this was not the case. In addition, participants noted that the "classic" form of privacy policy is long, complex and difficult to understand. The majority of participants preferred a shorter, synthesized form of the same policy.
Finally, we looked at the laws in force in France, the United States, the United Kingdom and Australia, in search of measures that might inspire us. We also took a close look at Canadian legislation. In comparative terms, Canadian law is evolving along the same lines as legal provisions abroad. On the other hand, we note that American, Australian and British law have all initiated the development of regulations specific to e-commerce with regard to credit.
For its part, France is more or less in line with Canada, where laws provide for pre-contractual information, but nothing specifically for e-commerce. France does, however, oblige credit companies to provide more information than is required in Canada.
Ultimately, we believe that US law is the most comprehensive regarding online credit. It requires companies to provide full disclosure of borrowing costs, whether for fixed or variable credit. What's more, the procedures put in place to adapt this information in terms of the form and mode of communication of information are provided for in the context of online commerce.
Finally, we think it would be interesting to draw inspiration from American e-commerce regulations, and also from the format proposed by the Australian regulation.
