Today, NBU in conjunction with the Verkhovna Rada Commissioner for Human Rights, has launched a nationwide communication campaign Know Your Rights to raise public awareness of consumer rights protection and obligations when receiving financial services.
In 2020, NBU received about 16,000 written applications from consumers of financial services. Some 40% of those applications referred to signs of consumer rights infringement. During the campaign, NBU will inform consumers how to avoid typical mistakes, such as taking out “zero interest” loans, buying unwanted additional services, paying account maintenance fees that have been changed without due notice, falling victim to debt-collector aggression, etc.
The campaign will take place in March through May 2021 in all regions of Ukraine. It will involve the launch of a special landing page by NBU called Know Your Rights. In addition to the contact center and the online application form on the NBU’s website, customers will have access to convenient channels of communication, including chat bots in Viber and Telegram, as well as on the NBU official website.
“For a number of reasons, Ukrainians use financial services reluctantly or don’t use them at all. Those reasons include previous crisis episodes, negative consumer experiences, and poor awareness of the advantages that come with the use of financial products. The NBU is pursuing the twofold purpose of setting additional requirements for financial institutions to ensure that they price their services transparently and treat their customers responsibly, and improving the financial awareness of consumers. These are prerequisites for strengthening the protection of financial services consumers, increasing the public’s involvement in the financial system, and encouraging consumers to use financial services more actively,” said Oleksii Shaban, Deputy Governor of the NBU.
The communication campaign is co-organized by the Verkhovna Rada Commissioner for Human Rights.
“In 2020, the Verkhovna Rada Commissioner for Human Rights received more than 2,000 messages regarding violations of personal data protection rigths. Most of that communication concerned violations of the right to noninterference in private and family life in the course of the recovery of debt from individuals, also known as debt collection activities. People complained that debt collectors had terrorized and blackmailed them, in particular by making annoying phone calls and sending obscene images. Most of the time, family members, neighbors, friends, and co-workers also become victims of these activities. Without a doubt, this is evidence of unlawful processing of personal data stolen from third parties. That includes phone numbers of individuals who have nothing to do with another person’s financial commitments. In addition, people often find themselves in “difficult life situations” only because they were unaware of the consequences of taking out cash loans by signing so-called “electronic agreements” on the websites of financial companies or through mobile apps. This is why the Commissioner has always emphasized that implementing measures to prevent violations of personal data protection rights is more important than punishing somebody for breaking the law,” said Inna Bernazyuk, personal data protection representative of the Verkhovna Rada Commissioner for Human Rights.
The campaign is supported by international partners: International Finance Corporation (IFC), in partnership with the Swiss State Secretariat for Economic Affairs SECO and the U.K. Government’s Good Governance Fund, and the EU’s technical assistance project Strengthening the Regulation and Supervision of the Nonbank Financial Market (EU-FINREG).
“Improved knowledge and skills in the area of financial products and services will help Ukrainian consumers better understand their rights as borrowers and make smart financial decisions. The new awareness campaign aims to help improve the level of trust in the financial sector and support the development of the country’s economy,” said Zarina Odinaeva, Project Lead of the IFC Ukraine Financial Inclusion for Growth Program.
“Financial education and consumer awareness are crucial elements to empower individuals to make informed decisions when managing their personal finances. It is important for the financial wellbeing of the Ukrainian citizens and their trust in the financial institutions. Public confidence in the financial system is fundamental for attracting investments and fostering economic growth in Ukraine. The EU supports combined efforts of the NBU to strengthen the market conduct rules for financial institutions and strengthening consumer protection policy. This effort will contribute to building a saving culture and deepening of the financial markets in Ukraine”, ‒ Julda Kielyte, Team Leader for Socio-economic & Fiscal Reforms, Support Group for Ukraine, EC Directorate General on Neighbourhood and Enlargement Negotiations, commented.
As previously reported, the NBU in January 2020 assumed two new functions: protecting consumer rights in financial services and enhancing the public’s financial awareness. Over the past year, the NBU worked together with other authorities and the parliament to lay the groundwork for more transparent and civilized relations between financial institutions and their customers. We continue with our efforts to bring the requirements for financial institutions in line with EU standards.