Cessione del Quinto

Italian Cessione del Quinto is one of the rare forms of financing regulated by law, flagship product of Mediocredito Europeo SpA. It is a loan intended for all categories of employees, both public and private, with permanent or temporary contract, atypical workers and retirees.Italian Cessione del Quinto is repaid by monthly fixed rate instalments. Unlike other forms of loan, such instalments are directly deducted from the salary up to a maximum of one-fifth, until the end of the debt.

Apart from this particular form of reimbursement, the salary-backed loan is particularly advantageous, as it allows accessing to large sums without having to specify their destination, and the payment can be spread from 24 to 120 months. The access to this form of financing is not subject to restrictive guarantees. The loan guarantee is exclusively represented by the employment: the instalments are paid as long as there's a payroll (or a pension) where they can be debited.  If this condition is fulfilled, no on-going protests or foreclosures will obstacle this financing.

How to access

Accessing to Italian Cessione del Quinto is easy, convenient and fast:
Easy>> The documents to be provided should demonstrate an employment contract or a pension;
Convenient>> Once the loan is obtained, the repayment is performed through payroll deduction;
Fast >> It is not necessary to specify how the loan will be spent.

 Benefits

- Financing with single signature: the signature of guarantors or of the spouse is not required;
- No information about the spending: there is no need to justify the request;
- The loan can be granted even with protests or other on-going funding;
- Repayment through salary deduction;
Maximum instalment amounting to 1/5 of the salary/pension: fixed rate for all the duration of the loan, regardless of the market conditions;
- Possibility to terminate or to renew the funding;
- The operation is guaranteed by an insurance activated in the event of premature death or loss of employment of the customer;
- No advance fee
- Duration of the loan from 24 to 120 months.

Involved parties

The transaction involves the intervention of four subjects:

1- The supplying company, which pursuant to the Presidential Decree 180 of 5 Jenuary 1950 (Law 180/50) and to the local regulations on banking, can be  only a bank, an insurance company or a financial intermediary registered into the list of the Bank of Italy.
2- The customer, defined as the transferor or the borrower, who signs the loan agreement, benefits from the financing and, simultaneously,  transfers to the supplying company one fifth of his monthly salary/pension.
3- Employer/Pension Authority, is the public or private employer where the transferor works, or the pension authority, which will be required, after the contract notification, to pay the monthly allowances for the repayment of the loan, deducted from the transferor salary. The employer/pension authority, while playing an active role in this operation, does not intervene in the contract, which remains solely bilateral between the Bank / Financial intermediary and the customer, if not by signing the documents required for the preliminary inquiry.
4- The insurance company that guarantees the operation. The legislation provides the funding to be guaranteed by an insurance policy covering the risk of death of the transferor or the loss of employment, either by resignation or dismissal. With regard to pensioners, a life insurance policy is instead required.

Recipients

Until some time ago, Italian Cessione del Quinto was exclusively reserved to state/public workers, while from the beginning of 2005 it became available to private employees. Now, pursuant to Law No. 80/2005 of  May 14th, , the range of people who can access to this kind of consumer credit grew further and also includes public and private pensioner as well as temporary workers and consultants.

- State / public workers
- Employees of private companies
- Pensioners
- Atypical workers

Thanks to recent provisions, also one fifth of the pension may be borrowed, apart from one fifth of the salary. For those who have completed their working life, the maximum loan is set at 10 years, but the funding must be guaranteed by a life insurance policy on the beneficiary, that protects the supplying company in the event of death.

Even atypical workers can access to salary-backed loan, but with an important limitation: the loan duration cannot exceed the time missing to the expiry of their contract.

Required documents

The procedure to get a cessione del quinto is quick and easy:
Few documents are needed:

- identity card (front and back) or valid document,
- fiscal code,
- last payroll/ pension slip,
- salary certificate (or, if not, certificate of service),
- complete W2 form (if requested).