Rada passes in first reading bill on protecting rights of financial services consumers
Ukraine's parliament has adopted in full draft law No. 1085-1 with amendments to several laws regarding the protection of the rights of consumers of financial services. The bill provides for the allocation of financial market regulators, including the National Bank of Ukraine, National Securities and Stock Market Commission and the National Commission for the State Regulation of the Financial Services Market, with the authority to apply sanctions to financial institutions and impose administrative penalties for violation of consumer rights.
Some 309 members of parliament supported the bill.
"We are talking about long-awaited changes in legislation by the market and consumers of financial services that will protect their rights in full, from small print in loan or deposit agreements, on the basis of which banks then sue huge amounts from their customers, and to regulate the advertising of financial services," Danylo Hetmantsev, who chairs the parliament's committee on finance, tax and customs policy, said in a speech from the Rada's rostrum.
According to the text of the draft law, it is planned to clearly prescribe in the Code of Administrative Offenses the rules defining violations of the rights of consumers of financial services as part of an administrative offense.
The bill provides a unified format for calculating the total cost of the loan and a unified formula for calculating the real annual interest rate that will be established for all financial institutions-lenders. The results of such calculations should be indicated in the consumer loan agreement.
If a law is passed, the same rules will be introduced for banks and non-banking financial institutions in the field of advertising financial services and the provision of information about them, and the same responsibility will be established for violation of consumer rights.
According to the authors of the bill, its adoption will strengthen the confidence of consumers of financial services in the financial sector, create mechanisms to protect their rights and interests, and ensure better consumer awareness of the financial services that they are offered.