Translation. Region: Russian Federal
Source: Central Bank of Russia –
An important disclaimer is at the bottom of this article.
According to Part 2 of Article 7 of Federal Law No. 353-FZ of 21.12.2013 "On Consumer Credit (Loan)" (hereinafter referred to as Law No. 353-FZ), if, when providing a consumer credit (loan), the borrower is offered additional services for a separate fee, rendered by the lender and (or) third parties, including life and (or) health insurance of the borrower in favor of the lender, as well as other insurable interests of the borrower, an application for the provision of a consumer credit (loan) must be completed in the form established by the lender, containing the consent of the borrower to the provision of such services, including the conclusion of other agreements that the borrower is obliged to conclude in connection with the consumer credit (loan) agreement. In such an application for a consumer credit (loan), the creditor is obliged to indicate the cost of the additional service of the creditor offered for a separate fee and must provide the borrower with the opportunity to agree or refuse to provide him with such additional service for a separate fee, including by concluding other agreements that the borrower is obliged to conclude in connection with the consumer credit (loan) agreement. The creditor is not allowed to make notes on the borrower's consent to the provision of additional services.
The specified provisions of Law No. 353-FZ are aimed at ensuring that the interests of the borrower are respected in terms of making an informed decision on the acquisition of additional paid services and preventing the creditor from taking actions that do not allow the borrower to make an informed choice or make it difficult.
In order to protect the interests of the borrower as the weaker party in the credit relationship, Law No. 353-FZ obliges the creditor to provide the borrower with the opportunity to freely express his/her will regarding the provision of additional paid services, and also prohibits the creditor from making notes on the borrower’s consent to the provision of additional paid services.
At the same time, in practice there are cases when the application for a consumer loan (credit) provides for a mark to be put only if the borrower does not agree to the provision of additional paid services. If the borrower does not put such a mark, it is considered that the borrower has given consent to the provision of additional paid services.
The use of unequal methods of expression by the borrower of his will regarding the provision of additional paid services is complex and confusing to understand, especially for the elderly and citizens with low financial literacy, and, as it seems, has as its actual goal the circumvention of the requirement of Part 2 of Article 7 of Law No. 353-FZ on providing the borrower with the opportunity to decide whether to agree to the provision of such services or to refuse them.
Thus, when implementing such a practice, the lender actually predetermines the borrower’s consent to the provision of additional paid services, which is unacceptable.
In connection with the above, taking into account that the obligation of the creditor to provide the borrower with the opportunity to agree or refuse to provide him with additional services for a separate fee, established in Part 2 of Article 7 of Law No. 353-FZ, is aimed at making an informed choice by the borrower regarding additional paid services, and this decision is an alternative for the borrower at a certain point in time, we believe that the appropriate practice would be to implement in the application for the provision of a consumer loan (credit) equivalent, easy-to-understand ways for the borrower to express his will.
We also inform you that the practice of using marketing techniques that encourage the borrower to make a certain decision (highlighting information in color or using a different font), as well as focusing the borrower's attention exclusively on information about the benefits of an additional service without specifying information about the properties of the specified service, including its volume and final cost, which does not allow the borrower to fully form an idea of all the conditions for purchasing the product, cannot be recognized as proper.
Please note: This information is raw content obtained directly from the source of the information. It is an accurate report of what the source claims and does not necessarily reflect the position of MIL-OSI or its clients.