Household Over-Indebtedness Bill

Following the Finance and Consumer Protection Committees’ consideration of the bills, three committee reports were issued on September 29, 2026, which reflect substantially different regulatory approaches to the treatment of consumer over-indebtedness. The majority report, proposed by the governing party, La Libertad Avanza, proposes a strategy focused on strengthening credit transparency, facilitating consumer mobility within the financial system, and promoting competition through tools such as credit portability, access to financial information, and the prevention of digital fraud.

In turn, one of the minority reports, supported by the Union por la Patria, Provincias Unidas, and Coalicion Civica blocs, promotes financial relief measures for over-indebted individuals, including debt refinancing and restructuring mechanisms.

The second minority report, put forward by Argentina Federal, also incorporates a specific personal insolvency regime inspired by so-called “second chance” systems.

During the Chamber of Representatives session of October 22, 2026, La Libertad Avanza’s Parliamentary Secretary, Silvana Giudici, requested referring the bill back to committee. The motion was approved by 121 votes in favor, 117 against, and 5 abstentions, and the bill consequently returned to committee for further analysis and negotiation.

The main aspects of the three reports are summarized below.
 

1. Majority report

1. 1. Credit transparency and access to information

One of the key features of the majority report is strengthening the disclosure obligations applicable to consumer credit transactions. To that end, the bill establishes new requirements regarding the information that must be made available to consumers before entering into financial agreements.

Among other measures, the proposal places particular emphasis on the Annual Effective Total Financial Cost (CFTEA), which must be displayed with adequate prominence and may not be presented in a manner that makes it subordinate to, concealed by, or less noticeable than the installment amount, a promotional rate, or other elements used to market the product. The bill also provides for a more detailed breakdown of the various components comprising the cost of financing, including interest rates, fees, insurance, administrative expenses, and applicable taxes.
 

1. 2. Credit portability

Another of the most innovative aspects of the majority report is the creation of a credit portability regime under which a consumer may request the replacement of an existing consumer credit facility with new financing offered and voluntarily approved by another provider under more favorable conditions.

To make this mechanism operational, the bill provides that the Argentine Central Bank (BCRA) will establish the procedures necessary for the secure and standardized exchange of information among the participants involved in the transaction.

The bill does not specify how prepayment costs will be treated or how responsibilities will be allocated between the original provider and the new provider during the substitution process. These matters would therefore be left to future BCRA regulations.
 

1. 3. Credit profile and open finance

Credit portability is closely linked to another of the bill’s main pillars: the use of mechanisms consistent with open finance frameworks. Although the initiative does not establish a comprehensive open finance regime, it incorporates several elements aligned with regulatory developments promoted in recent years in this area. It especially provides that consumers may authorize sharing financial information among different providers through secure and standardized mechanisms.

Accordingly, the bill contemplates creating an interoperable credit profile that would consolidate information relevant for credit risk assessment and facilitating its use by different participants authorized by the consumer.

Similarly, with the aim of strengthening the security of transactions carried out through digital channels, the bill introduces requirements relating to identity verification, proof of consumer consent, and the retention of electronic records associated with the contracting process.
 

1. 4. Financial education and consumer protection

The proposed reports encompass matters relating to the responsible use of credit, understanding financial costs, identifying digital fraud, and exercising rights recognized under consumer protection regulations. They also include provisions on the exercise of withdrawal rights in remote transactions, as well as monitoring and notification systems for certain transactions carried out through digital platforms.
 

2. minority reports

The minority reports depart from the approach adopted by the majority report, which seeks to improve the functioning of the credit market through greater transparency, credit portability, and access to information. Both reports are based on the premise that over-indebtedness affects a significant portion of consumers and propose intervention measures in existing credit relationships.

From that perspective, these reports incorporate mandatory refinancing mechanisms, restrictions on certain debt collection practices, and special procedures for individuals facing insolvency.
 

1. 1. Special debt regularization and financial relief regime

One of the main pillars of the minority reports is the creation of special regimes to restructure consumer debt. The proposals contemplate grace periods, waiving default interest, and repayment plans designed according to the debtor’s financial capacity. They also provide for the suspension of certain enforcement measures while regularization proceedings are underway. These measures entail modifications to previously agreed-upon contractual terms and could affect the enforcement of outstanding credit obligations.

The regime that would be established following the Union por la Patria, Provincias Unidas, and Coalicion Civica report requires a 100% waiver of default interest, suspending garnishments and negative credit reporting, and minimum repayment terms of 12 months, with a compensatory interest rate that may not exceed the TAMAR rate plus an additional 25% margin.
 

1. 2. Personal insolvency and “second chance” mechanisms

The second minority report incorporates a specific insolvency regime for individuals inspired by so-called “second chance” systems. The proposal is aimed at individuals experiencing insolvency or over-indebtedness, who would automatically be entered into the Federal Registry of Second Chance Debtors (RENDSO). It also establishes simplified procedures intended to facilitate the reorganization and eventual discharge of liabilities vis-à-vis creditors.

The regime contemplates two main mechanisms. First, it creates a Simplified Personal Insolvency Proceeding (CPS), through which the debtor may submit a repayment plan of up to five years, subject to court and creditor approval. The plan may include reductions of up to 60% of unsecured principal and grace periods to repay obligations.

The bill also provides for a Liquidation with Discharge of Residual Debt (LEPR) procedure if the debtor’s financial situation does not allow a solution through a repayment plan. In such cases, once the debtor’s attachable assets have been liquidated, and if the debtor has acted in good faith, a court may discharge the remaining insolvency claims not satisfied during the proceeding.

This proposal also contemplates special mechanisms for low-value consumer debts, which could be conducted entirely through digital channels, as well as provisions intended to limit the impact of these proceedings on credit histories once completed, thereby reducing the amount of information available for credit risk assessment.

Unlike the refinancing regime contemplated in the first minority report, this proposal does not merely restructure existing debts but rather introduces a personal insolvency framework that allows reducing and discharging obligations in situations of over-indebtedness.