Covid-19 really put the creditor’s liability to the test – bank practices should be improved

The Consumer Ombudsman asked three banks how the joint liability of the creditor and the seller is realised in their operations. When the consumer pays for a purchase by credit, in case of cancellation or error, for example, the consumer can apply for a compensation or refund not only from the seller but also from the credit company.  

When the Covid-19 pandemic began in spring 2020, consumers, as well as creditors, faced a new situation. The trips and events paid in advance by consumers were cancelled or postponed, customer services were congested and patience was tested. The Consumer Ombudsman and the Consumer Advisory Services of the FCCA highlighted that the guidelines issued by banks to consumers were not in all respects in line with legislation. There were also clear irregularities.

As a result of consumer contacts, the Consumer Ombudsman requested a clarification from OP Financial Group, Nordea and Danske Bank on how the joint liability of the creditor and the seller is realised. Banks were asked to clarify how the creditor’s liability is communicated to consumers, what instructions customer service has received, what kind of clarification is required of the consumer as part of a payment card claim, whether a deadline has been set for filing a complaint and how long the consumer has to wait on average for the return of the purchase price.

The reports indicated, among other things, that consumers’ claims for compensation were rejected without justification on various grounds. Consumers could be required to carry out unreasonable procedures, such as filing a complaint with an insolvency estate in the Czech language. Complaints were rejected by imposing non-legal deadlines on consumers to file a complaint, or consumers were referred back and forth to service providers and banks, without anyone genuinely handling the consumer’s case.

Reasonable terms and conditions for banks and clearer information and customer service

In negotiations with banks, the Consumer Ombudsman required that banks improve the availability and quality of instructions provided on their website and in customer service. According to the Consumer Ombudsman’s observations, an unnecessarily small amount of information on consumer rights was provided on the banks’ websites.

“It is particularly important to pay attention to providing consumers with information about their statutory rights and, on the other hand, about the creditor's obligations. The information must be easily accessible and as clear and unambiguous as possible.”


The negotiations also emphasised the importance of a functional customer service. After being contacted by a consumer, the customer service must not remain passive so that consumers have to enquire about their messages and claims for compensation.

In connection with the negotiations with the Consumer Ombudsman, banks have examined the information on creditor liability and their contractual terms provided by their customer service and on their website. The banks also reported that they had taken measures to provide relevant information in a clearer manner.

The creditor’s liability protects the consumer in unexpected situations

If the purchase has been paid by credit, for instance by credit card, the creditor is liable for the seller’s breach of contract along with the seller. For instance, the consumer may submit their claim to the creditor, if the company does not deliver the goods or services, such as tickets for concerts or other events. The creditor may also be contacted if the seller has gone bankrupt, for example in a situation where the airline or travel agency cannot organise the promised journey due to bankruptcy.

A complaint should first be submitted to the seller, and if it does not produce results within a reasonable amount of time, the creditor should be requested for a refund. In particular, paying for more expensive purchases with a credit card gives the consumer protection in unexpected situations.

Creditor liability cannot be marketed as an additional benefit

The Consumer Ombudsman also discussed the way two banks used the Purchase protection concept to market cards. The capitalised Purchasing protection concept is likely to create an impression of an additional benefit offered to the consumer, though it is part of the creditor’s liability required by law.

Its misleading nature was also underlined by the fact that information on the actual statutory creditor liability was poorly provided on the website for filing a complaint with a bank. Instead, more information was provided for marketing cards, which gave the impression of a non-statutory obligation. A consumer who needs information about their rights and the bank’s obligations is unlikely to search for it on a website focusing on marketing cards.