On May 12, 2023, a 78-year-old woman living in a town in eastern Hungary had HUF 121,115 (€ 308) deducted from her HUF 144,935 (€369) pension by the bailiff. By this time, the elderly woman was deeply in debt.

Between 2015 and 2016, she took out a total of ten loans from a credit company, ranging from HUF 40,000 (€102) to HUF 100,000 (€255). She had already repaid six of them, and four were still outstanding when her granddaughter discovered the extent of the borrowing that had taken place without her family’s knowledge.

“My grandmother tried to keep it a secret, but it came to light,” said the granddaughter, who, at her grandmother’s request, took over her registered mail and thus encountered the incoming payment orders.

The granddaughter could not understand how anyone could have given her grandmother a loan, as she believed that her mental capacity was “highly questionable” at the time the loans were taken out. The woman, who had previously worked as a hospital administrator, was morbidly thin, weighing only 33-35 kilograms, took sedatives three times a day, was confused and struggled with hallucinations, which were noted in medical reports a year later.

“I think that a normal person with sufficient moral sense would have been able to determine that my grandmother was not mentally competent,” added her granddaughter.

Nevertheless, in 2015, she was granted loans totaling HUF 390,000 (€ 993), and in 2016, a total of HUF 430,000 (€1094) in ten different transactions. She received these loans even though her pension in the summer of 2016 was just under HUF 90,000 (€229), while she was expected to repay roughly double that amount in repayments. “They deceived me very badly” – she said, describing how she felt about what had happened to her.

The elderly woman took out these loans from Provident, the largest – and in some respects unique – domestic player in the so-called quick loan market.

Provident, a company that has consistently generated billions of forints in profits in recent years, has been operating in Hungary for more than two decades, and although there have been attempts in the past to impose stricter regulations on its activities, which many consider harmful, it has been continuing its business uninterrupted for quite some time now.

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In 2011, the Fidesz-dominated parliament passed a law aimed at curbing excessively high interest rates by limiting the so-called total credit cost indicator, but they left an opening for Provident. Lawmakers created a regulation that exempted the so-called home service fee from this indicator, which indicates the total cost of the loan.

Customers must pay this fee for the company’s employees to deliver the loan to their homes and collect the repayments from them. It can be several times higher than the loan’s official interest. The home service fee also accounted for most of the debt that the 78-year-old pensioner had to repay.  According to her granddaughter, her elderly, confused grandmother was unaware of how much this home service cost and was shocked when she found out.

According to Provident’s own statements and sources familiar with the company, this fee forms at least part of the business basis for the company’s operations. Although a government program has pointed out that the company’s activities contribute to the indebtedness of the most disadvantaged Hungarians, and there are examples in neighboring countries where authorities have taken action against schemes similar to the home service fee, no official initiative has been taken in Hungary.

Meanwhile, Provident has made serious efforts to build good relations with government circles. They generously supported the Ferencvárosi Torna Club, and Gábor Kubatov, one of the vice presidents of Fidesz and a member of parliament, described his relationship with the company’s management as friendly a few years ago.

Provident’s current CEO, Viktor Boczán, answered our questions in a lengthy interview and said that their customer satisfaction index is 93 percent and that, in his opinion, the market in which they operate is one of the most regulated in Central and Eastern Europe. He said that with 215,000 customers and 1,500 regional representatives, they cannot claim that everything is flawless, but they do have internal control mechanisms in place. He emphasized that every single customer complaint is investigated very thoroughly, and if any irregularities are found, they are dealt with “immediately, fairly, and equitably.” Regarding their relationship with politics, he said that Provident, like any company, simply wants to have a relationship with the government of the day that allows for dialogue when necessary.

Regarding the case of the grandmother in eastern Hungary, the CEO said that it was difficult to respond without knowing the details, but strict rules limit how much credit a person can receive. He added that Provident is even stricter than the relevant regulations of the Hungarian National Bank when it comes to setting upper limits on credit.

He also said that it is general practice that if a customer is limited in any way in their decision-making, it is not possible to grant a loan. According to Boczán, they rely on their representatives to

“assess to the fullest extent possible whether the client’s state of health and consciousness allows them to make responsible decisions.”

He added that “we work with a lot of people, I can’t say that everyone is always perfect,” and if a case similar to the grandmother’s does occur, they have internal procedures in place and a separate department that continuously monitors “whether everything was done according to the rules.”

However, the grandmother in eastern Hungary did not file a complaint with the company because, according to her granddaughter, a lawyer they knew advised them against it, saying that it would be pointless. “I regret it now. Looking back, I definitely wouldn’t let it go,” added the granddaughter.

Thus, no one officially investigated whether there had been any irregularities in the grandmother’s case when she took out the loans. However, as our research has shown, the home service fee, which accounts for a large part of her debts, spread throughout Hungary completely legally, with the silent assistance of Hungarian lawmakers.

They saw the potential in Hungary

Provident, which traces its roots back to England and dates back to 1880, arrived in Hungary in May 2001 with features that were new to the country: unsecured, home-delivered cash quick loans and weekly repayments.

Central Europe was an attractive region for the parent company to expand into. Hungary’s 10 million population represented a large potential customer base, and other factors in its favor included a well-educated and inexpensive labor force, the presence of other British companies such as Tesco, and the country’s planned accession to the EU in 2004. Preliminary research also painted a favorable picture. Surveys showed that the Hungarian market had similar potential to the Czech and Polish markets: there was high demand for the service, cash was attractive, and customers were open to weekly and monthly repayments.

Customer acquisition progressed spectacularly well and even accelerated: in their second year of operation, they already had 55,000 customers, and this number grew to 143,000 by 2003. Provident became profitable in Hungary sooner than the parent company had initially calculated.

Originally, they expected to turn a profit only in 2005, but the company had already became profitable in 2004.

The company’s services expanded quickly despite the high prices. The total credit cost indicator (APR) was already above 300 percent at the outset.

The APR is an indicator calculated using a complex formula that helps consumers see the total cost of their loan and compare offers from different providers. Although it is expressed as a percentage, the APR does not simply mean the percentage of the amount borrowed that must be repaid. The formula also considers the length of the term and the frequency of repayments.

As the company grew and expanded, the APR on its products exceeded 400 percent over time, and criticism of Provident intensified.

In 2008, Máté Szabó, the Parliamentary Commissioner for Civil Rights, mentioned high-interest quick loans in the same breath as illegal usurious loans. He wrote that both were causing an increasing problem, “creating a trap for society.” The ombudsman initiated a proposal to classify loans with costs exceeding ten times the central bank’s base rate as unfair commercial practices, but in the end, no action was taken.

Shortly thereafter, however, regulatory authorities—and Provident itself—came under increased pressure.

Action group against Provident

On the afternoon of February 16, 2009, passersby were greeted by unusual commotion in front of Provident’s Budapest headquarters. An organization calling itself the Antiprovident Action Group held a demonstration there, which led to the closure of Bajcsy-Zsilinszky Street.

Although relatively few people attended the demonstration, the message harshly criticizing the company reached many people, and the Antiprovident Action Group also took other protest measures. One of the leaders of the organization was Norbert Alt, who was a Fidesz municipal representative in Gyula at the time and is currently the city’s deputy mayor.

“Before 2010, I worked in the social sector. That’s when I noticed that many people with little or no income had Provident loans, for which the loan officer regularly visited them to collect the repayments,”

Alt said of the early days.

“Comparing the size of the loans taken out and the final amount to be repaid, it was not difficult to see that this was a huge rip-off. What’s more, doing this to people who were already vulnerable and in difficult social circumstances at the time was unscrupulous,” he explained.

“Let’s not forget that at the time, we were in the midst of a financial and social crisis. This was what triggered the formation of the group and the resulting social movement. The rest just happened on its own,” he added.

The press also covered the Antiprovident Action Group extensively. “The campaign received a lot of media hype, even by the standards of the time. Thanks to the movement and all the fuss it caused, politicians and lawmakers had to address the issue,” the Gyula politician told Direkt36, attributing this to the fact that “within a short period of time, the laws on quick loans were amended to prioritize the interests of customers and consumers by capping the APR and the amount of quick loans that could be taken out per year.”

The first legislative change was not yet decisive.

At the end of 2009, parliament voted that a person could only take out a loan with a total credit cost indicator higher than 65 percent and less than HUF 250,000 (€ 636) once a year.

The APR cap and the negative taste in the mouth

More serious steps in regulation had to wait until April 2012. It was then that the APR cap was finally introduced in Hungary. According to the legislation currently in force, financial institutions are not allowed to grant loans with a total credit cost indicator exceeding the central bank’s base rate plus 24 percentage points.

At the end of 2011, when the draft of this regulation was submitted to parliament, Antal Rogán (the powerful minister running the cabinet of Prime Minister Viktor Orbán), as chairman of the economic committee and rapporteur for the agenda item, described the innovation as “definitely a reform.”

The Fidesz politician also said that “the APR regulation opens up very serious opportunities for the future” because it

“forces Hungarian banks to behave fairly, and I think fair behavior is good for everyone.”

He added that this step is “good for customers because they will encounter predictable conditions.” (We asked Rogán how he sees the current situation, but he did not respond to our questions. The Ministry of National Economy also declined to comment)

The regulation proposed in 2011 was welcomed by Provident’s then CEO, Botond Szirmák.

“Following the new APR regulation (…) I believe that the negative taste in the mouth associated with ‘quick loans’ are now a thing of the past, as the pricing of our products is now fully comparable to credit cards, for example,”

Szirmák said in an interview with Napi Gazdaság in April 2012, after the APR cap came into effect.

However, there was one thing left that, in a sense, continued the previous practice. This was the home service fee, which is not restricted by the APR regulation.

Optional – here’s the loophole

In February 2009, ten days after the first Antiprovident demonstration, Provident officials announced at a press conference that the company was introducing a new, cheaper bank transfer product, applicants could now decide whether they wanted home service or whether they would receive the loan by bank transfer and repay it that way.

At that time, Provident still calculated the fees of those who chose home service into the total credit cost indicator. According to MTI news, Gergely Mikola, Provident’s communications director at the time, mentioned a 54-week loan of HUF 100,000 (€ 255) as an example at the press conference. Mikola said that the total credit cost indicator would be 87.99 percent with the bank transfer service, while it would remain 262.44 percent with the home service.

But later, something changed with the inclusion of this fee in the APR.

The total credit cost indicator is defined by a 2010 government decree. According to this, only the fees for services that are mandatory for the credit agreement are to be included in the APR, while the fees for optional services are not. Thus, the fee for home services is also excluded from the APR and the relevant limits.

According to opposition sources following parliamentary work from within, although there was an opportunity to tighten the rules, for example in 2013 with the adoption of the law on credit institutions and financial enterprises, the possibility of changing this situation was not raised in parliamentary debates.

“It is certain that this was not the subject of substantive debate at the time,”

said one of them.

The basis of the business model

According to several sources familiar with the company’s internal operations, Provident’s business model is largely based on home service fees.

Most customers take out loans using this service, despite its considerable cost. According to Provident CEO Viktor Boczán, this applies to roughly 70 percent of customers.

One of the main reasons for this high percentage is that it speeds up the process considerably compared to the much cheaper option of arranging the loan via bank transfer. Sources familiar with Provident’s fieldwork also told Direkt36 that the main attraction of the home service is not convenience, but immediacy.

“Let me be honest, if someone needs money, when do they need it? Now. Within a few hours,”

said one source who worked directly with customers for more than ten years. In his experience, “95 percent of people came in already knowing they needed” the home service, where they receive cash in hand immediately upon signing the contract.

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If someone chooses the cheaper bank transfer option, the process is much slower. First, the customer must go to the nearest county seat, to the customer service center. There, their details are recorded. If they are lucky, the credit assessment will be completed quickly and they can wait on the spot, but if not, they will be called a second time to sign the contract. Provident promises that the money will arrive within 10 working days of signing the contract, which in practice can mean a wait of up to 14 days.

According to a former Provident employee, this may be suitable for those who are thinking in terms of larger sums, say if the person needs a million, but can wait two weeks. “But what about those who have to pay for electricity, water, and wood?” he asked. His clientele consisted primarily of such people, and he was not alone in this.

According to Provident CEO Viktor Boczán, in addition to convenience, speed, and flexibility, there are other arguments in favor of home services from the customer’s point of view. According to Boczán, those who use this service are not charged late fees or penalties if they miss a payment.

HUF500 000 (€1284) loan and HUF528 500 (€1357) fee 

The calculator on Provident’s website clearly shows how high the home service fee can be for a given loan.

On this page, in addition to various loan amounts and terms, you can also specify whether or not the customer requires home service, i.e., whether they want to receive the loan in cash at their home and have a Provident employee come to their home to collect repayments. If you select this option, the calculator shows you how much the service will cost under the given conditions. The same figures can also be found in the repayment tables published on the website.

The other costs pale in comparison to the total cost of the home service, which is at least close to, but often exceeds, the amount of the loan taken out.

The total fee for home services consists of two parts: there is a rather hefty one-time placement fee, typically amounting to 30 percent of the loan amount, and there is a fee payable after weekly visits. The latter depends on the length of the term. For example, for 110 weeks, it is 75.7 percent.

The price, therefore, varies according to the term and loan amount; there is no fixed fee for home visits.

Let’s look at an example:

We take out a loan of HUF 500,000 (€1284) with home service for 110 weeks, with weekly repayments. According to the calculator, the APR is relatively low at 30.44 percent, and the interest is only HUF 155,250 (€398). However, the HUF 528,500 (€1357) fee for the home service is added to this. This means that more than double the original loan of HUF 500,000 (€1284), HUF 1,183,750 (€3040), must be repaid.

A source of problems in every second village among the poorest

In theory, the government is also aware of the impact that these high-interest quick loans have on the poorest segments of society.

In 2019, it launched a program called Felzárkózó Települések (Catching-up Settlements Programme) to help the 300 poorest Hungarian settlements. As part of the program, the Hungarian Charity Service of the Order of Malta prepared a situation report for each settlement entitled “Housing Diagnosis and Intervention Plan.” These documents frequently mention Provident in connection with indebtedness, in the context that the company’s loan portfolio in the given location is or was high, and many of the locals owe money to Provident.

“Indebtedness affects a significant proportion of the population living in rural areas, with the majority of officially reported debts originating from Provident loans,” wrote, for example, Téseny in Baranya County.  “Indebtedness is characteristic among Provident personal loan borrowers,” they noted in Monaj, Borsod-Abaúj-Zemplén County. And in Tiszaigar, Jász-Nagykun-Szolnok County, they wrote that “Provident borrowing is quite widespread, and the number of people living in a debt spiral is high.”

We counted how many times the word Provident appears in the descriptions of 154 of the 300 poorest settlements. In the vast majority of cases, the company’s name appears in a context where its activities are linked to the indebtedness of the people living there.

According to György Király, head of the debt management team at the Hungarian Charity Service of the Order of Malta, one of the factors underlying Provident’s success in these settlements is their isolation from banks: most small settlements do not have bank branches, people are not mobile, they don’t have money for public transport, and they can’t go and find out about other options.

Money is needed – according to the experience of staff members of the Hungarian Charity Service of the Order of Malta, Provident loans are taken out for a variety of reasons. Some people take out such loans for major holidays, unexpected expenses such as funerals or broken household appliances, while the younger generation may spend it on more expensive phones, TVs or cars. Others pay off utility bills when they receive a one-off high bill or to prevent their utilities from being cut off. In addition, there are those who buy fuel, pay rent and deposits in cities, or “plug the gaps,” i.e., make up for the loss of income caused by other loans and blockages.

Told, located in the Berettyóújfalu district, where the Igazgyöngy Foundation works to eradicate child poverty, is one of the 154 municipalities. According to Nóra L. Ritók, the foundation’s professional director, Provident debt occurs in essentially all families living in generational poverty within their network. They have observed the same phenomenon in other settlements: many people cover their daily living expenses in this way.

“The tragic thing is that life strategies and survival strategies are built around accessing this money,”

said L. Ritók.

Even children within their sphere of influence already know what Provident is. However, while according to L. Ritók even children are aware that “you can get money from here,” they lack financial awareness, which is why, based on the experiences of the foundation , there is a great need for financial education, not only for children but also for adults.

In Nógrád and Borsod-Abaúj-Zemplén Counties, we visited one settlement each, and in Heves, two settlements that are among the 154 poorest villages mentioned Provident in the context of indebtedness in the “housing diagnosis and intervention plan” prepared for the Felzárkózó Települések (Catching Up Settlements) program.

A 67-year-old woman from Heves County was upset that she and her son did not receive the large loan they wanted, only HUF 100,000 (€256) each, even though, according to her, when she called Provident’s central number, she was generally promised that up to one million forints would be available. “We were so happy with my child,” she said, and as if she was talking about Christmas, her face changed as she daydreamed and talked about how they began to plan what they could do with that money. They wanted to tile the bathroom and paint it. In the end, she spent half of the HUF 100,000 (€256) she received on her parents’ gravestones, and gave the other HUF 50,000 (€128) to her eighth-grade grandchild for his graduation.

According to György Király, head of the Hungarian Charity Service of the Order of Malta’s debt management team, there is “enormous scope” for Provident and similar consumer credit organizations because the short-term thinking and narrow focus common among those living in extreme poverty and destitution make this possible, for many, the horizon is not years or months, but the given week.

“They realize that they will definitely be able to pay for a month or two, but their perspective does not extend beyond that, and this is a generational phenomenon,”

he said.

“I don’t think we are the cause of indebtedness,” responded Provident’s CEO to the fact that the company is often mentioned in reports in a negative context. In his opinion, if other banks and financial institutions are not present in certain towns, then it “logically follows” that “Provident is pretty much the only borrowing option available to them there.”

He also disagrees that the company’s customers are among the poorest Hungarians, as Provident has had approximately 1.7 million customers in the nearly 25 years it has been in operation.

Not everyone is perfect all the time

Meanwhile, many people are unaware of how significantly the home service fee increases the cost of the loan. In one disadvantaged village visited by Direkt36, there was someone who firmly believed that the home service was more financially advantageous than arranging the loan through a bank.

According to the contract, home service can theoretically be canceled free of charge during the term of the loan, and the borrower can switch to bank transfer. In practice, however, this is not so simple. One of the conditions, for example, is that there must be no outstanding payments. In addition, even if the home service is canceled, this type of cost is still included in the monthly fee, albeit to a lesser extent. This is because the one-time placement fee must be paid in installments in any case.

The Hungarian Charity Service of the Order of Malta’s debt management staff often recommend cancellation, but in their experience, clients are often reluctant to take this step. According to charity workers, there are signs that Provident’s agents also use psychological tricks. At least occasionally, clients back out of canceling home services, saying things like, “I didn’t want to hurt the lady who comes here,” or “They asked me what was wrong with the service, and ultimately, I don’t have a problem with it.”

In this regard, Provident’s CEO stated that, while he cannot responsibly claim that everyone in such a large organization performs their work flawlessly, he finds it very difficult to imagine that their employees would exert such pressure. He justified this in part by saying that this work is typically done by “middle-aged and typically female” employees, and that the company has a zero-tolerance policy for any irregularities in dealing with customers.

Boczán added that they strive to ensure that customers understand the terms of the loan on “every existing platform.”

“We do everything we can in this regard, but if the customer still feels that they have not received or understood some information, or are unsure what it means, they can contact us at any time, and not just the sales advisors,”

he said.

He also stated: “It is also very much in our business policy interests to fortify responsible credit assessment as much as possible, because, unlike banks, we do not operate our own funds, but obtain the funds from which we grant loans from the money market.  So, if we make a bad decision, it is the company that suffers the consequences.”

Weekly fee per month

Meanwhile, there are also signs that despite charging a weekly fee for home services, Provident employees actually visit customers much less often.

In a village in Heves County, a retired woman who used to work as a cleaner showed us her so-called payment record card, a blue document from Provident on which the amounts paid are recorded by date. This showed that although the agreed repayment installment was HUF 10,000 (€25) per week, the woman had been paying HUF 40,000 (€100) once a month for six months. She said she had asked for monthly payments because “my pension comes once a month.” She often tells the Provident employee who handles her account, “Come back before I spend it all, because if you don’t, I won’t pay you.”

According to several Provident employees, hers is not an isolated case. There are several reasons for this. One is that, like the retired woman in Heves, customers often do not want Provident to call them every week, and they agree with them to come only once a month to collect all the weekly installments at once.

“Everyone says the same thing: don’t bother me, don’t let the neighbors see, then I’ll have all my money in one go…”

said a former sales consultant.

If someone is not visited as often as the contract specifies, and not at their own request, then according to the head of Provident, the necessary steps will be taken after a complaint. According to Boczán, if their investigation reveals that the home service fee was “not earned” due to the company’s fault, then “we will act in a manner that is fair to the customer.”

Another reason why fewer home visits take place in practice than should be is that many customers have several contracts at the same time – in such cases, the repayment installments for the various contracts are collected at the same time, rather than during separate visits.

The third reason is similar to the previous one: it is not uncommon for several different people in a household or family to have Provident contracts – in such cases, too, they typically visit the home only once and collect the repayments at the same time.

In such cases, the home service fee is still charged because, according to Provident’s interpretation, it is linked to the contracts themselves. So it does not matter how many times a company employee visits or who they visit. If, during a single trip, they visit several customers who live in the same town or even in the same house, they will still collect the home service fee from everyone.

Boczán added, however, that there are practical examples of more than one visit per week. According to him, it happens that a Provident representative visits a customer at a pre-arranged time, but the customer asks them to come back later, at another time, and Provident does so.

Consumer protection has been strictly enforced in Poland

Authorities in other countries in the region have taken action against irregularities in home-based services.

In December 2013, the Polish consumer protection authority (UOKiK) imposed fines totaling more than PLN 12 million (more than €2.8 million, approximately HUF 1.1 billion). The reason for the fine was that, according to the authority, Provident Polska violated the collective interests of consumers when it provided false information about the total cost of home loans, failing to inform its customers about the cost of home services.

The company challenged the authority’s decision, and years of litigation ensued. Over the years, IPF insisted that it had acted in compliance with the law. According to the court of appeal hearing the case, consumers in difficult financial circumstances who urgently needed money were particularly vulnerable to such loans, as they were much more willing to accept unfavorable terms that they only learned about at the final stage of concluding the loan agreement.

The court also pointed out that the fees charged for servicing loans at the customer’s home were disproportionate to the costs incurred by Provident, according to a statement from the UOKiK press office to Direkt36.

Provident Polska appealed even this decision, but to no avail: in December 2019, the Supreme Court rejected the company’s appeal.

Expulsion from Slovakia

Slovakia also took action against extra fees. In 2015, the neighboring country created a legal environment that squeezed the company out of business. Provident eventually withdrew from the country’s market.

At the end of 2015, the ruling party, Smer, introduced an anti-usury reform package to protect borrowers, which included three key restrictions on consumer loans: in addition to the interest rate cap, the fees associated with the loan and the penalties for late payers were also maximized.

In addition, they prohibited the linking of loans to additional services that make the loan more expensive and are included in separate contracts. This essentially pulled the rug out from under Provident’s business model.

According to the Slovak National Bank (NBS), which oversees the financial market, the reforms were meant to fight “predatory” lending, especially by non-bank companies that often used deceptive methods to cross borders.

The NBS tested Provident at the end of 2015 with the help of inspectors posing as consumers. The inspectors concluded supplementary service contracts alongside their basic loan agreements, the subject matter of which was very similar to the home service existing in Hungary. The essence of these contracts was that Provident would come to the location specified by the customer, typically their home, to collect the repayment installments.

The National Bank of Slovakia found that with this separate contract, the company had essentially deliberately circumvented the law on consumer credit. It classified this as an unfair commercial practice, as it considered that Provident had engaged in misleading conduct and provided false information about the price of its product by failing to include the costs of the service contract in the APR. On the other hand, it also condemned Provident because, even when these costs were taken into account, it exceeded the maximum permissible amount of financial compensation. Provident was ultimately fined.

Even before the NBS imposed its fine, a spokesperson for the Provident Financial group announced on local television in February 2016 that the company had decided to withdraw from Slovakia.

According to the NBS press office, the reforms had a significant impact on the market. Provident was not the only company to leave Slovakia as a result of the tightening of regulations. Cetelem and Fair Credit did the same. (We contacted the Hungarian National Bank, which is responsible for supervisory activities in Hungary, but they did not respond to our questions.)

Viktor Boczán, CEO of Provident Hungary, told Direkt36 that the main reason for leaving Slovakia was the increasingly unpredictable environment. According to him, what happened there was that “from one day to the next, contradictory regulations were introduced.”

After their departure, he said, illegal lending became widespread in Slovakia. “Afterwards, we were asked if we would be willing to return, but by then we had decided that once the closed sign was up, that was the right thing to do,” Boczán noted.

A long journey with Fradi

Meanwhile, Provident has been operating smoothly in Hungary for years, maintaining good relations with a figure close to the government.

Ten years ago, the parent company indicated that it considered building political connections important. In his 2015 report, the CEO of IPF wrote that the regulatory environment is changing and that innovations are being driven by “openly populist” agendas. According to the document, the company’s response to this was, among other things, to increase cooperation with political parties through lobbying organizations.

Provident Hungary has maintained and nurtured an important friendship for more than a decade.

“Botond and I have been friends for 10 years, back then we only had plans, no results. We have come a long way since then,”

said Gábor Kubatov, president of Fradi (Ferencvárosi Torna Club, one of Hungary’s best-known and most successful sports clubs, particularly famous for its football team.) and deputy chairman of the Fidesz party, at a press conference, according to a July 2022 article in Origo. The “Botond” mentioned by Kubatov is none other than Botond Szirmák, who was CEO of Provident between 2008 and 2024.

At the end of 2011, the year Gábor Kubatov became president of Fradi, Provident became a sponsor of the club.  Botond Szirmák signed a three-year contract for HUF 210 million (€538 186) in sponsorship.

Szirmák wrote to Direkt36 that it was through this sponsorship that he got to know Gábor Kubatov. “Over the years, we developed a friendship based on our shared commitment to Ferencváros and Hungarian sporting success,” Szirmák said. (We also contacted Kubatov, but he did not respond to our request for comment.)

According to Viktor Boczán, Szirmák’s successor, one of the considerations in sponsoring Fradi was that 800 000 people in the country identify themselves as Fradi fans, “so when I look at which club resonates the most in Hungary and touches the most people, it is clearly Ferencvárosi Torna Club.”

He noted that they also support other smaller sports organizations in various sports. They were official sponsors of Ferencváros for only three years starting in 2011, and since then there have been “ad hoc project-type collaborations,” Boczán added.

In October 2016, for example, Szirmák and Kubatov jointly inaugurated the new community space at the Népliget Sports Complex, Provident Park, which was sponsored by the namesake.

“At the time when Gábor Kubatov became president of Ferencváros, he presented me with a vision of the future that I wanted to be a part of,”

Szirmák said at the time.

The wishes of the then CEO were fulfilled, and Provident became part of Fradi’s future, renting its own skybox – a private, premium space – at Groupama Arena.

Thanks to Provident, Ferencváros also has a parking lot for people with reduced mobility at the Groupama Arena, which was handed over in 2018, and shortly afterwards, Botond Szirmák received the Fradi Fair Play award in the Fradi Heart category. The former CEO, who now works as a European-level executive for IPF, is currently a member of the Ferencvárosi Torna Club’s board of directors, having been elected by the members at the general meeting in 2022.

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Provident employees have planted trees and shrubs together with Fradi footballers and fans on several occasions at the Budakeszi Wildlife Park. Provident supported the publication of the storybook Fradista leszek (I Will Be a Fradi Fan) with HUF 15 million (€38 441), and in 2023, it helped Fradi’s affiliate team, Soroksár SC, with HUF 50 million (€128 139).

The cooperation continued even after the company got a new CEO in 2024. In April of that year, Szirmák’s successor, Viktor Boczán, gave a speech and planted the first tree at an event attended by the soccer players.

Illustration: Péter Somogyi (Szarvas) / Telex