Who will ultimately pay for loans in francs?

Conversion of the loan in francs into USD without changing the interest rate? Exclusion of illegal indexation clauses? Treating franc loans as loans? It is difficult to say which scenario will eventually find coverage in reality

Processed processes


Many borrowers who have taken loans in USD are judged by banks. They raise an accusation that their credit agreements contained so-called abusive clauses – illegal indexation clauses. Accuse banks of not informing you about the risk associated with the franc loan.

In addition, the clauses mentioned above indicate on what basis the USD exchange rate used to calculate the level of debt and loan installments is calculated. Loans are supported by the Good Finance and say that the rates were arbitrarily set by banks, not on the basis of objective premises.

First win case


Interestingly, on July 10, 2019, information appeared in the media that the Warsaw Court of Appeal annulled in its entirety a loan agreement regarding a loan in USD.

He considers that the provision is unfair, not only because banks have changed their rates, but that the indexation mechanism will expose the borrower to unilateral banking risk. Thus, the customer will win with the bank granting him the loan in USD.

At present, arguments for the nullity of a contract may go to the Supreme Court in a short time, and if he agrees with the position of the borrower, then similarly courts, this means an avalanche of cases and a verdict regarding the invalidity of credit agreements. Banks may feel this strongly, but this is not the only way to solve the franc issue.

Soon, there will also be a decision on the part of the Court of Justice of the European Union, which is to rule on borrowers who take out loans in USD and the inclusion of clauses in loan agreements prohibited.

Currency conversion possible

Currency conversion possible

The franc supporters suggest converting Swiss franc loans into USD, but at the same low-interest rate. This may be in line with the positions of the spokesperson of the GFIC and the Supreme Court. Since illegal index clauses existed in loan agreements, they should be ignored.

Faced with this, banks would have to treat franc loans as USD loans – as if there were never any conversion of francs into USD and vice versa.

Therefore, there would be a need to recalculate all installments back, which could be another blow to banks that would have to pay back significant amounts to their clients.

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