New legal provisions improving consumers’ position came into force at the beginning of the year

Legal provisions that came into force on 1 January 2017 finally make online banking credentials available to everyone. Regulations regarding changes to housing loan and consumer credit interests and payments have also been revised. Peer-to-peer finance intermediaries are required to register and ensure compliance with the provisions of the Consumer Protection Act.

For years, the Consumer Ombudsman has insisted that online banking credentials should be made available to everyone. Online banking credentials have not been included in basic banking services, and certain groups such as people with a bad credit history have had trouble obtaining them. However, online banking credentials have, for a long time, been a basic requirement not only for paying bills and accessing other banking services, but also for electronic identification. Not having these credentials has made life unnecessarily difficult for a number of consumers.

This will finally change with the amendments to the Payment Services Act, which came into force on 1 January 2017. These amendments were prompted by the Act on Credit institutions, which requires banks to offer online banking credentials to all consumers residing legally in Finland. In this context, provisions will be laid down regarding a national obligation to offer a strong electronic identification service, which in practice means online banking credentials.

Similarly, at the beginning of 2017, some amendments were made to legislation concerning housing loans and consumer credit, and some revisions will be made to eliminate unclear provisions. The new provisions will apply to new credit agreements signed after their entry into force. The credit interest rate can only change if the reference rate specified in the agreement changes, and provided that such an arrangement is included in the credit agreement. However, contrary to the Consumer Ombudsman’s opinion, the provider of a housing loan is allowed to charge the consumer for a loan margin even when the reference rate is negative, and when such an arrangement is included in the loan agreement.

Tying practices have been previously regulated under the Act on Credit Institutions, but are now also prohibited under the Consumer Protection Act. This means that a consumer taking out a housing loan cannot be required to buy an insurance policy or a real estate agent’s services from the lender’s partners.

In the future, peer-to-peer, or non-professional financial intermediaries will be required to register on the lender and peer-to-peer financial intermediary register kept by the Regional State Administrative Agency for Southern Finland. In addition, peer-to-peer finance intermediaries are required to ensure compliance with the provisions on consumer credit of the Consumer Protection Act, even in credit agreements signed between private individuals.

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Online banking credentials and electronic identification finally available for everyone. Finnish Consumer Ombudsman’s Newsletter 5/2016.