Banks May Have to Give Customers More Information if Legislation is Enacted

 

According to a report carried on Caribbean360, in light of concerns about hidden, unannounced and exorbitant fees imposed on customers by commercial banks, Minister of Industry, Investment and Commerce Karl Samuda has indicated the possibility of legislation being enacted to ensure that commercial banks provide customers with adequate information on their services.

“There is no point in saying that you need to do this but there is no enforcement of that provision to protect the consumer,” he said against the background of the recommendations of the Fair Trading Commission (FTC), that mechanisms be put in place to improve the availability of relevant information, so as to facilitate informed choices on the part of customers, and the banks.

In its report on the nature and extent of competition in the commercial banking sector, the FTC revealed that only 31 per cent of customers indicated that they were notified of bank charges; 30 per cent were aware of changes only after they were made, and eight per cent were aware of such changes before they were carried out.

Meanwhile, 58 per cent of consumers expressed satisfaction with banking services, and 67 per cent choose banks based on convenience and location or accessibility. The FTC found that 63 per cent of customers still bank at the institution at which they opened their first account, and 59 per cent said they would switch banks for lowered fees. Some 41 per cent of customers indicated that they are unaware of bank charges.

Samuda said the Consumer Affairs Commission (CAC) will be providing information on such fees and charges to the public.

“No longer will we go along and simply accept what is thrown at us. What I’m hoping we will be able to do, is to have information posted, so that consumers can access this information and you don’t have to make an appointment with a bank, to find out what it’s going to cost you (to do business with the bank),” he said.

In addition to mechanisms to ensure that customers are aware of fees, the FTC has also recommended that measures be put in place to ensure that banks have easier access to customer information; and that a credit bureau be established to better facilitate services, which involve credit worthiness assessment.

“Given the disparity in the level of fees (in the sector) and the observed lack of information on the part of consumers, there is significant room for promoting competition within the sector, with improvement in the flow of adequate information,” the report said.

(Content lifted from Caribbean360.com)

 

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