Third Phase of Taiwan’s Financial Consumer Protection Rules for Leasing Firms Takes Effect in September

Taiwan’s Financial Supervisory Commission is bringing financing and leasing companies under the Financial Consumer Protection Act in three stages. The sector provides installment financing for consumer goods, cars and motorcycles but has not previously been covered comprehensively by the law. The expansion is intended to close that gap by requiring clearer disclosure of interest rates and fees, as well as more rigorous checks of borrowers’ creditworthiness and repayment capacity.

The FSC said complaints involving financing and leasing services had reached 163 as of the end of June, rising significantly as regulatory coverage expanded. The third stage is scheduled to take effect in mid-September and will extend the law to every member of the Taipei Leasing Association. Covered firms will be required to disclose borrowing costs clearly and conduct credit and affordability assessments before extending financing.

Taiwan’s financing and leasing companies provide installment credit for vehicles and consumer goods but have historically operated outside the full regulatory framework applied to banks. That gap has left borrowers with fewer protections in disputes involving contract cancellation, defective products and debt collection. The Financial Supervisory Commission is bringing the sector under the Financial Consumer Protection Act in three stages to strengthen disclosure, contract fairness and complaint handling.

The FSC’s third and final phase will add 12 financing and leasing companies on Sept. 15, 2026, bringing the total covered by the law to 38. The regulator is targeting opaque interest rates and fees, financing that exceeds a customer’s needs or repayment capacity, and improper collection practices. Covered firms will also be required to establish clearer procedures for resolving cancellations and disputes tied to defective goods.