Behavioural Finance and Consumer Loan Contracts

Due to the situation that has emerged in the wake of retail lending, particularly foreign currency lending, every circumstance that leads to excessive systemic risks must be taken into consideration, namely the absence of consumer self-control, under- and overreactions and the risks stemming from intertemporal retail consumer decisions. The authors attempt to make consumer decisions understandable by analysing biased intertemporal models. Based on the relevant literature, the authors use a behavioural science approach to shed light using on the underlying factors of action or passivity, the factors that introduce bias into consumer rationality and their potential management, in particular asset regulation and the fair bank acts, deeper and more comprehensive regulation of legal relationships, keeping in mind not only the key interest of consumer protection, but also the predictable and sustainable long-term functioning of financial institutions.