New rules for Consumer Credit Providers and Unauthorized Financial Activities in Sweden

In recent years, Sweden has experienced growing over-indebtedness among certain households. To curb this development, the legislator has initiated several measures, and we have seen an increased number of regulatory investigations by the Swedish Financial Supervisory Authority (the “FSA”) and the Swedish Consumer Agency targeting consumer credit institutions. 

As a next step to further protect consumers from over-indebtedness and aggressive marketing practices, the Swedish Government has submitted a bill to the Riksdag with proposals for stricter regulations for consumer credit providers, measures we have previously reported on here. These changes would effectively phase out the current consumer credit institution category, requiring providers of consumer credits to obtain a bank or credit market company license to continue their business activities. The new rules are proposed to enter into force on 1 July 2025, however, businesses operating under consumer credit licenses issued prior to that date will have until end-July 2026 to transition.

Additionally, the Swedish Ministry of Finance has proposed new legislation regarding penalties for unauthorized financial activities. Financial activities conducted without proper authorization or registration with the FSA is proposed to be criminalized. The new offense would be classified as “unauthorized financial activities”. The proposed legislation establishes two severity levels: standard offense, punishable by fines or imprisonment up to 2 years, and aggravated offense, punishable by imprisonment from 6 months to 6 years. Minor cases are exempt from criminal liability. The proposal also criminalizes attempts, preparations, and conspiracy to commit aggravated unauthorized financial activities. Law enforcement agencies would gain expanded powers, including the use of covert surveillance measures during investigations and the ability to collect specific information to prevent or detect aggravated violations. It is important to note that the new legislation would apply broadly to entities conducting financial activities without proper authorization, not only consumer credit providers. These new rules are proposed to enter into force on 1 October 2025.

Eversheds Sutherland (Sweden) is closely monitoring the relevant proposals. For more information on navigating the Swedish regulatory landscape, please feel free to reach out to our key contacts below.