Safeguarding the Rights of Financial Services' Consumers: What You Should Know?

The National Bank of Ukraine has the authority to protect the rights of consumers of financial services, and regulates the behavior of banks and nonbank financial institutions in relation to their customers. The Office for Financial Services Consumer Rights Protection is an NBU unit that deals with this issue.
 
Work to protect the rights of consumers of financial services is focused on three major areas:

  • processing individuals' appeals
  • setting requirements for financial institutions
  • supervising compliance with legislation that safeguards the rights of consumers of financial services, and monitoring compliance with advertising laws (that govern advertising in financial services).

 

How to apply in writing

The most convenient way to contact the NBU is via remote channels:

  • send an online request or write to [email protected] using a special form
  • send a letter, along with supporting documents, to: 01601, Kyiv, 9, Instytutska St.,

In your application, state the essence of your issue and provide your contact information. Specify:

  • your first name, middle name (if any), and last name
  • place of residence
  • e-mail address
  • a summary of your question, proposal, or complaint.

Please provide sufficient information for the NBU to make a substantiated decision. For more about how to make appeals, see the Guidelines on the Organization of Consideration of Citizens' Appeals, the Conduct of Appointments, and the Provision of Access to Public Information at the National Bank of Ukraine.

How long will it take to receive an answer?

A response to a standard appeal takes 30 days to provide.

However, if the appeal requires no additional research or verification, an answer may be given in less than 15 days.

In complicated cases, the review period may be extended to 45 days. But the NBU always informs the applicant about such an extension.

The terms of consideration of appeals are established by the Law of Ukraine On Appeals of Citizens.

How to get the contact center's attention

If you have questions, complaints, or suggestions regarding the services of financial institutions, you can receive advice from our specialists by calling 0 800 505 240.

If your issue requires further consideration, contact center operators will register your request for further processing. A contact center employee will ask you to give your name, place of residence, e-mail, and to describe the essence of your question, proposal, or complaint.

How to make a personal appointment

To make an appointment with the NBU, call the contact center at 0 800 505 240 or fill out the online form.

When making a personal appointment, please provide the following information:

  • full name
  • place of residence or address where official correspondence can be delivered
  • contact phone or information on other ways to reach you
  • summary of the question raised
  • names of financial or other institutions (organizations) that you or your representative have previously applied to regarding this issue, and what decision was made.

Wait for your application to be processed and for a return call from our specialists with confirmation of the appointment.

Personal appointments are conducted by the head of the Office for Financial Services Consumer Rights Protection or other authorized officials of the NBU.

The Office for Financial Services Consumer Rights Protection holds in-person appointments on the second and fourth Thursdays of each month, from 3 p.m. to 6 p.m. You can sign up no later than 5 business days before the date of your appointment.

What to keep in mind: The NBU performs video and audio recording of personal appointments, for transparency and security purposes.

Applications the NBU rejects

The NBU does not consider anonymous applications that do not specify the applicant's name and place of residence. Issues beyond the NBU's purview are referred to the relevant public authority. The NBU always notifies the applicant that such a referral has been made. If the application does not contain sufficient information, we return it and ask to provide more data. A repeat application on the same issue is also rejected if the first appeal has been resolved.

Should you wish to read more, please consult the Guidelines on the Organization of Consideration of Citizens' Appeals, the Conduct of Appointments, and the Provision of Access to Public Information at the National Bank of Ukraine.

How to appeal the NBU's actions or their absence

Under Article 23 of the Law of Ukraine On Access to Public Information, appeals against information managers' decisions, actions, or absence thereof, may be filed with the leadership of said information managers, a higher authority, or a court.

The following actions, or their absence, may be appealed:

  • refusal to satisfy a request for information
  • postponement of the satisfaction of the request for information
  • failure to respond to a request for information
  • provision of inaccurate or incomplete information
  • untimely provision of information
  • nonfulfillment by information managers of their obligation to publish information in accordance with Article 15 of the Law of Ukraine On Access to Public Information
  • information managers' other decisions, actions, or absence of actions, that violated the legal rights and interests of the person making the appeal.

Appealing information managers' decisions, actions, or lack of actions, in court is carried out in accordance with the Code of Administrative Court Procedure of Ukraine.

How to request public information

Individuals, legal entities, associations of citizens with no legal entity status, except for government authorities, have the right to request information from the NBU, regardless of whether such information concerns said entities personally, without explaining the reason for such a request. One can send an online request or write to [email protected] using a special form

The request for information must contain:

  • full name
  • postal address or e-mail address, and a phone number, if any
  • a general description of the information being requested or the type, name, details, or content of the requested document.

In the following cases, the NBU will deny to meet a request for information:

  • The NBU does not possess, and is not obliged to possess, within its purview, information for which the request was made.
  • The requested information is categorized as information with limited access in accordance with Article 6 part 2 of the Law On Public Information.
  • The entity requesting the information has not reimbursed the actual costs associated with copying or printing the information.
  • The requirements for processing a request for information have not been met.

The decision to refuse or postpone the satisfaction of the request for information is communicated in writing.

A response to a request for information shall be provided no later than five business days from the date of its receipt. However, the period for consideration of a request for information may be extended to twenty business days. For more, see the Guidelines on the Organization of Consideration of Citizens' Appeals, the Conduct of Appointments, and the Provision of Access to Public Information at the National Bank of Ukraine

 

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Report

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For customers

How to prevent your rights from being violated?

Every service comes with a set of conditions. First of all, find out what those are. If it's a loan, its conditions include the full cost of taking it out, the full interest rate, all additional fees and charges, late payment penalties, the loan repayment schedule, and more.

Second, read the agreement carefully. Of course, any agreement is a legal document that may be hard to understand. But if you are planning to make a deposit, take out a loan, or use another service, read all the terms and conditions carefully. By signing this document, you take responsibility to adhere to it, after all.

How to understand whether a financial institution is violating clients' rights?

Typical signs of being in breach of financial services consumers' rights:

  • The service provider makes a demand on the consumer to repay another person's loan when in fact the consumer is not a guarantor, heir, or representative of the debtor.
  • The service provider resorts to harsh methods of debt collection (e.g., obscene language, moral pressure on the consumer, threats).
  • The service provider makes persistent solicitations to compel the consumer to buy its credit products (credit cards or limits) when the bank reissues the consumer's payment card.
  • The loan provider charges interest for a period that is longer than the time the consumer has been using the loan.
  • The insurer does not make an insurance payment in full, fails to make an insurance payment, or intentionally refuses to make an insurance payment.

What to do if a financial institution violates your rights?

Before anything else, contact the financial institution directly. You can call their "hotline," but it is better to send a written complaint to their management. Sometimes consumers manage to quickly resolve the situation or have their questions answered at this level.

If the issue could not be resolved, the consumer can contact the NBU. The best way to do it is:

  • by filling out the online form on the NBU's website
  • by writing to [email protected]:
  • by calling the NBU Contact Center at 0 800 505 240
  • by chatting with nbu_contact_bot in Viber or Telegram.

In the appeal, it is important to describe the nature of the issue, indicate the institution to which the appeal relates, your full name, place of residence, and e-mail.

The NBU has 30 calendar days to consider your appeal. However, we try to respond as promptly as possible, especially to urgent appeals.

A financial institution advertises a "zero interest loan." What's wrong with this ad?

A consumer loan ad must specify the loan's real annual interest rate, maximum amount, and maturity. Similarly, financial institutions must post on their websites information on the total cost of the loan with all fees and payments, the real annual interest rate, terms and amounts, conditions of early repayment, fines in case of violation of lending conditions, and more. In some cases, however, the cost of the loan may differ from the expected or advertised cost because the financial institution indicates in its advertising materials only an interest rate that is attractive to the consumer, like 1%–2% per day. This is an outright violation that can be misleading as to the actual total cost of such a loan. Please report such violations to the NBU!

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Financial institutions

What must banks, NBFIs, and debt collection agencies do to protect consumers?

The first thing is to comply with the requirements of the legislation of Ukraine, and the regulations of the NBU, on the protection of the rights of consumers of financial services. Banks, NBFIs, and debt collectors take responsibility to prevent the inclusion of unfair clauses in agreements concluded with consumers, avoid deceptive practices when advertising services, comply with requirements for ethical behavior during the settlement of overdue debts, and more.

Banks, NBFIs, and debt collectors are also obliged to be proactive in working with clients by explaining all the conditions for purchasing the service, informing clients in a timely manner about changes in fees for using cards in a way that is convenient for the consumer, and reminding clients, in advance, that the end of the term of validity of their deposits is approaching. In other words, banks, NBFIs, and debt collectors must take actions that prevent conflict situations with the consumer and ward off the occurrence of debt due to a misunderstanding of the terms of a specific service.

What are the advertising requirements for financial services?

The advertising requirements for financial services are defined in Article 24 of the Law of Ukraine On Advertising, Article 11 of the Law of Ukraine On Financial Services and State Regulation of Financial Services Markets, and Article 7 of the Law of Ukraine On Consumer Lending. In addition, advertising in financial services is governed by NBU regulations: NBU Board Resolution No. 141 On Approval of the Regulation On Information Support for the Clients by Banks as Regards Banking and Other Financial Services (as amended), dated 28 November 2019; and NBU Board Resolution No. 100 On Approval of the Regulation On Provision of Information by Financial Institutions to Consumers Regarding the Provision of Consumer Lending Services (as amended), dated 5 October 2021.

All financial institutions must disclose complete, accurate, and reliable information in their advertising. At the same time, the method of advertising should not complicate the visual perception of information about the service.

Banks must post on their own websites complete information about consumer loan services, deposit services, in standardized format, with a list of essential characteristics of such services, as well as calculators for comparing total costs of or revenues from said services, taking into account the accompanying services of the bank, credit intermediaries, and third parties, including taxes and fees, in accordance with the legislation of Ukraine.

NBFIs engaged in consumer lending must meet similar requirements when placing, on their websites, calculators and information about consumer loan services.

What corrective actions are applied to institutions that violate the rights of consumers of financial services?

For violation of Ukrainian legislation on the protection of the rights of consumers of financial services, including requirements for ethical behavior, and for breach of requirements for advertising in financial services markets, the NBU applies the following corrective actions to the entity that committed said violations: issues written warnings, obliges the entity to eliminate the violation. If said violations were perpetrated by an NBFI that made the original loan or by an NBFI that is a new creditor, the NBU suspends or revokes the NBFI's license to provide financial services and applies fines in the cases provided for in Article 411 of the Law of Ukraine On Financial Services and State Regulation of Financial Services Market. Penalties range from 300 to 8,000 tax-free minimum incomes of citizens. The NBU can also impose fines for failure to submit, or untimely submission of, information, or submission of purposefully inaccurate information. Such fines can be anywhere between 100 and 2,000 tax-free minimum incomes of citizens. The central bank also charges administrative fines on officials of financial institutions. In addition, for breach by debt collection companies of ethical conduct requirements, the regulator applies corrective actions in the form of a temporary ban on the debt collection company's activities to settle overdue debts, and excludes information about this debt collection agency from the register of debt collectors.

Respective supervision is carried out in accordance with NBU Board Resolution No. 198 dated 2 September 2022, the application of influence measures is carried out in accordance with NBU Board Resolution No. 346 dated 17 August 2012 (as amended) (corrective actions for banks), NBU Board Resolution No. 12 dated 1 February  (as amended) (corrective actions for NBFIs), and NBU Board Resolution No. 78 dated 9 July 2021 (as amended) (corrective actions for debt collectors).

Does the NBU have the right to order snap inspections of financial institutions if customers complain about them?

A consumer appeal does not constitute grounds for an unscheduled inspection. However, such an inspection is possible if the NBU has detected systemic violations, and if the financial institution has not eliminated them.

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