The Government of Spain promotes greater financial protection for customers in the lending sector

Moncloa Palace, Madrid

Ministers José Manuel Albares, Elma Saiz and Carlos Cuerpo appear at the press conference after the Council of Ministers (Pool Moncloa/José Manuel Álvarez)

The Council of Ministers has addressed a draft bill to regulate consumer credit which, in addition, transposes two European directives. The text will be immediately released for public consultation, along with a royal decree that implements it.

The Minister for Economy, Trade and Business, Carlos Cuerpo, stated that this comprehensive reform protects consumers, prevents over-indebtedness, and increases transparency and accountability in this segment of the credit market. Consumer credit, Cuerpo pointed out, reached €114 billion in November 2025, representing approximately 15% of total household credit, an all-time high. The microcredit or high-cost loan segment represents approximately 0.5% of the total, but affects 9% of transactions and is particularly relevant for lower-income households.

Limits on the cost of loans and increased transparency

The proposed regulations primarily limit the costs associated with consumer loans, differentiating between a general system and a specific one for high-cost loans.

The Minister for Economy, Trade and Business, Carlos Cuerpo, during the press conference | Pool Moncloa/José Manuel Álvarez

As for the general system, the limit will be published quarterly in advance by the Bank of Spain and will decrease as the loan amount increases: the higher the amount, the lower the cost limit for consumers. Until the royal decree comes into effect, the limit is temporarily set at 22%. Carlos Cuerpo pointed out that this affects new loans, but also the existing stock of revolving credit cards (those with a predetermined credit limit that can be repaid in instalments): one in four loans on these cards will have to be revised downwards for consumers.

Regarding the regulations for high-cost loans and microloans, the monthly interest rate is capped at 4%, and the maximum origination fee is limited to 5% or €30. Furthermore, the draft bill introduces several additional safeguards: it establishes a minimum of three monthly instalments and limits the costs associated with early repayment. It also sets a minimum approval time of 24 hours for these types of loans and strengthens the information provided on all terms and conditions (in fact, it prohibits advertising that focuses exclusively on the immediacy of the loan).

Another key change is that only entities authorised by the Bank of Spain will be permitted to grant consumer loans. In addition, high-cost lenders will be subject to a special code of conduct. "We are advocating for the professionalisation of this sector and for increased transparency in this segment," stated Cuerpo.

The minister explained that the average microloan currently is €300 for 30 days, with a cost of €103. Under the new regulations, if the minimum term of 3 months is met, the maximum cost would be €40. And if the consumer opts for early repayment, the maximum cost would be €20.

Economic growth and household income recovery

The Minister for Economy, Trade and Business, Carlos Cuerpo, appears to explain the agreements adopted during the Council of Ministers | Pool Moncloa/José Manuel Álvarez

At the press conference after the Council of Ministers, Carlos Cuerpo explained the good progress of the Spanish economy. Specifically, in the last quarter of 2025, the increase in Gross Domestic Product (GDP) was around 0.7%, thus maintaining the momentum of growth and the leading position of the Spanish economy among the world's largest. This figure brings Spain closer to meeting its 2026 growth forecast, set at 2.2% by the government, in line with analysts' predictions. Beyond these impressive figures, he added, the growth pattern is "sound and balanced" and is based on two main sources: private consumption and private investment.

Cuerpo highlighted the contribution of a dynamic and structurally improving labour market: in the third quarter of 2025, 22.4 million people were employed and, despite the increase in the labour force, unemployment has fallen to around 10%. Employment is growing most in medium-to-high technology and high value-added sectors, and temporary contracts have decreased, converging with European figures. This job creation is also being carried out in a way that is compatible with increased hourly productivity and improved household purchasing power.

According to the minister, real disposable household income per capita has grown more in Spain than in the main OECD countries since 2022, which translates into "a greater sense of confidence and optimism among economic actors compared to our main trading partners".

Thanks to the evolution of income and employment, household finances are in a sound financial position. Carlos Cuerpo pointed out that the figures are better than those of the last 25 years and that, for example, total household debt is at levels seen at the beginning of the euro era. This allows for a balance between increased consumption and increased savings, the minister said, adding that the improvement extends to all income levels and there are no widespread problems of over-indebtedness.

Defence of international law and the sovereignty of states

The Minister for Foreign Affairs, European Union and Cooperation, José Manuel Albares, at the press conference after the Council of Ministers | Pool Moncloa/José Manuel Álvarez

During his address, the Minister for Foreign Affairs, European Union and Cooperation, José Manuel Albares, defended "the rules of the international order and the values of peace, dialogue, and security on which it is based and which are at stake at this time".

Albares cited as challenges "the situation this past weekend in Venezuela", the tension surrounding Greenland, and the conflicts in Ukraine and Gaza. "International peace and stability are only possible when international law is respected and when disputes are resolved peacefully and through institutional channels", he argued.

With regard to Venezuela, the Foreign Affairs Minister stated that the future of that country must be built through dialogue among Venezuelans in a democratic manner and by peaceful means. "We reject any action that does not respect its sovereignty and violates international law," said Albares, who recalled Spain's leadership in this position, both in the Ibero-American sphere and within the European Union.

These same values, he asserted, are what, "in different scenarios, for different causes and motivations, but also defying international law, allow us to demand peace and justice for Ukraine and Gaza and lead us to demand respect for the sovereignty of a European country like Denmark in relation to Greenland".

From autonomy to European sovereignty

The Minister for Foreign Affairs, European Union and Cooperation, José Manuel Albares, at the press conference after the Council of Ministers | Pool Moncloa/José Manuel Álvarez

Albares argued that the current choice is between authoritarianism and democracy because there is no freedom without law and without institutions to protect it, both nationally and internationally. "No democrat can resign themselves to an order of injustice and arbitrariness that undermines our democracy", he stated.

The minister also argued that Europe must recognise its strength and take its rightful place among the world's great political powers: "It is no longer enough to talk about autonomy; we must move towards true European sovereignty: political, commercial, economic, defensive, and also in foreign policy. To weaken Europe, he added, is to weaken Spain.

The government will continue to work for further EU integration, international cooperation, multilateralism, democracy, social justice, peace and security, Albares reiterated. This will be precisely the orientation of Spain's foreign policy, which the minister will share at the Conference of Ambassadors, which the President of the Government of Spain will open tomorrow and the King will close the following day.

More renewable energy in transport

The Council of Ministers has raised the annual target for incorporating biofuels and other renewable fuels in transport from 12% to 14% by 2026.

The Minister for Inclusion, Social Security and Migration and Government Spokesperson, Elma Saiz, explained that the change aims to facilitate the gradual adaptation to the European directive so that by 2030 the share of renewable energy in final transport consumption reaches at least 29%. The transport sector accounts for 30% of greenhouse gas emissions. The amendment adopted today also strengthens fraud prevention.

Forest restoration and fire prevention

The Minister for Inclusion, Social Security and Migration and Government Spokesperson, Elma Saiz, during her speech at the press conference after the Council of Ministers | Pool Moncloa/José Manuel Álvarez

The Government addressed several emergency declarations in response to the forest fires of last summer. The spokesperson explained that these agreements categorise several of the fires that occurred in August in the provinces of Ávila, León, Ourense, Palencia, and Zamora as natural disasters and establish emergency forest restoration measures in all affected areas. The approximate cost of these projects exceeds 9.3 million euros in total.

"After this extremely difficult year of 2025, we must continue working to ensure that this situation is not repeated in 2026", said Elma Saiz, who recalled that the last Council of Ministers meeting of the previous year allowed for early retirement for forest firefighters and forest and environmental agents, in recognition of the demanding and dangerous nature of these professions.

Development partnerships

The Ministry of Foreign Affairs, European Union and Cooperation has informed the Council of Ministers of the approval of several development partnerships with three countries: Egypt, Uruguay and Colombia. Each partnership includes a series of priorities agreed upon with the country in question, within a specific timeframe.

In the case of Egypt, for example, these priorities include issues such as democratic governance through stronger institutions and the promotion of gender equality; in the case of Colombia, the partnership focuses on building a lasting and sustainable peace in the country. "This is the foreign policy that Spain defends, based on international relations of collaboration and respect, not on impositions", stated Elma Saiz.

Current Affairs

The Minister for Inclusion, Social Security and Migration and Government Spokesperson, Elma Saiz, at the press conference after the Council of Ministers | Pool Moncloa/José Manuel Álvarez

The government spokeswoman insisted that Spain will continue to lead the way toward a democratic solution for Venezuela and defend international law. She also expressed the government's solidarity with the Venezuelan people "so that they may soon achieve stability and their voices may be heard".

Furthermore, Elma Saiz conveyed the government's support to the victims of the recent storms and flash floods that have affected various parts of Spain. "These floods have taught us a painful lesson: climate change is not a theory, it is a reality that is impacting our towns and cities", she stated.

The Minister for Inclusion, Social Security and Migration added a "message of hope" in the wake of the latest data on the number of national insurance contributors, which is now approaching 22 million. "At the end of 2018, it was just 19 million. We have become accustomed to breaking down barriers month after month," she noted.

Saiz highlighted that this marks four consecutive years of job creation, with approximately half a million new jobs added each year, and that Spain is registering record numbers of women in employment, self-employed workers, and foreign workers. Furthermore, she emphasised that job growth is particularly significant in high value-added sectors, such as telecommunications and scientific activities, and that, thanks to labour reform, temporary employment is at its lowest level in recorded history.

Non official translation