The appropriate draft has already been developed.

With a view to strengthening the protection of rights and interests of consumers the RoK National Bank has developed a concept to the draft law “On introducing amendments and additions to some legislative acts of the RoK on issues related to the provision of financial services” the regulator’s web site informs.

The draft bill proposes to establish a number of prohibitions and restrictions for the banks, including:

– establishment of a special procedure for money distribution when repaying overdue debts on loans;

– establishment of a ban on the collection of fees related to the issuance and service of banking, microfinance loans;

– changing the maximum size of a forfeit or other kinds of penalties for early repayment of loans depending on the term of a loan;

– establishment of common time bases for the calculation of interest on loans and so on.

Previously the National Bank adopted a number of amendments to legislative acts that significantly improve the rights and legal interests of consumers of financial services

In particular: – for the first time in the CIS, banks are obliged to disclose the annual effective interest rate in the bank loan/deposit contracts and when spreading information on the size of interest on loans and deposits. This indicator represents a real value of a loan or deposit. During the crisis (2008) a three-year ban (moratorium) was imposed which prohibits banks from changing unilaterally the fixed interest rates of bank loans to individuals in connection with the presence of such practices in bank loan agreements

В феврале 2011 года законодательно были установлены maximum size of an annual effective interest rate, a ban on unilateral changes of terms of bank loan agreements, a ban on the indexation of payments tied to any currency equivalent, a limit of the size of the penalty for non-fulfillment of obligations under bank loan contracts: not more than 0.5% of the overdue amount per day, but not more than 10% of the amount of a granted loan for each effective year of the bank loan contract. Also bans were imposed on the introduction of new commissions under concluded loan agreements, on the imposition of a fine for partial or full early repayment of a loan after one year from the date of issuance of the bank loan, on extrajudicial sale by banks of pledged immovable assets in the presence of an appropriate written waiver of a pledger – physical person, on extrajudicial sale by micro-credit organizations and credit unions of pledged immovable property which is a house and (or) land plot with a dwelling located thereon. Furthermore, an obligation was introduced for pledge holders to conduct an independent assessment of pledged property whenever it needs to be sold.

In the current year the National Bank applied 79 limited pressure measures for the violation of the rights of consumers of financial services. In the first half of 2014 the regulator received 5,832 appeals of citizens and legal persons. In February a working committee was created to address problems of borrowers, and in October 2014 the National Bank opened the Public Chamber where every consumer of financial services can apply to for a consultation and clarification of the current legislation in the banking, insurance and pension sectors, as well as in the sphere of securities market.


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