CLARIFICATION OF SCOPE
Consumer Credit, Payment Services and Electronic Money
- Where regulated entities are providing credit under credit agreements which fall within the scope of the European Communities (Consumer Credit Agreements) Regulations 2010 (S.I. No. 281 of 2010), only Provision 6.8 in this Chapter applies.
- Where regulated entities are providing payment services and/or issuing electronic money, the Provisions in this Chapter do not apply.
TERM AND NOTICE DEPOSIT ACCOUNTS (6.3 - 6.4)
In relation to all term and notice deposit accounts with a balance in excess of €20, a credit institution must at least annually, provide to a consumer:
- a statement of the account which includes, where applicable:
i. the opening balance;
ii. all additions;
iii. all withdrawals;
iv. all interest credited;
v. all charges;
vi. the closing balance;
vii. details of the interest rate(s) applied to the account during the period covered by the statement; and
viii. where tax is deducted from interest credited, information on the tax deducted or on how consumers may obtain a certificate detailing the tax paid.
- details of interest rates applied to other similar accounts available to the consumer from that credit institution; and
- where the term of the account is less than one year, the credit institution must provide to a consumer a closing statement which contains this information.
A credit institution must ensure that at least 10 business days prior to the maturity of a fixed term deposit, it alerts the consumer about its impending maturity and the maturity date. This provision does not apply where the maturity date of the fixed term deposit is less than 30 days.
CREDIT (6.5 - 6.12)
In relation to loans, a regulated entity must, at least annually, provide to a personal consumer a statement of the account which includes:
- the opening balance;
- all transactions;
- all interest charged;
- all charges;
- the outstanding balance due; and
- details of the interest rate(s) applied to the account during the period covered by the statement.
A regulated entity must notify affected personal consumers, on paper or on another durable medium, of any change in the interest rate on a loan. This notification must include:
- the date from which the new rate applies;
- details of the old and new rate;
- the revised repayment amount; and
- an invitation for the personal consumer to contact the lender if he or she anticipates difficulties meeting the higher repayments.
In the case of a mortgage where a revised repayment arrangement has been put in place in accordance with the Code of Conduct for Mortgage Arrears, the notification must clearly indicate the revised repayment amount required in Part c) that applies to the revised repayment arrangement.
A regulated entity must provide the notification required under Provision 6.6 to a personal consumer at least 30 days in advance of any change in the interest rate, except in the following circumstances:
- In the case of a tracker interest rate, the regulated entity must provide the notification required under Provision 6.6 as soon as possible, and no later than 10 business days after the regulated entity becomes aware of a change in the underlying rate being tracked; or
- For loans other than mortgage loans, where the following conditions are satisfied, the regulated entity does not need to provide the notification required under Provision 6.6:
- the change in the interest rate is caused by a change in a reference rate which changes on a daily or weekly basis;
- the new reference rate is made publicly available by appropriate means; and
- information concerning the new reference rate is kept available on the premises of the regulated entity.
Where a regulated entity has advanced credit to a personal consumer subject to a guarantee, the regulated entity must notify the guarantor, on paper or on another durable medium, if the terms of the credit agreement change.
- a personal consumer requests to change from an existing tracker interest rate; or
- a regulated entity offers a personal consumer the option to move from a tracker interest rate to an alternative rate on their existing loan;
the lender must provide the personal consumer with the following information, on paper or on another durable medium:
- indicative comparisons of the cost of the monthly loan repayments at the personal consumer’s current tracker interest rate and each of the alternative rate(s) being offered;
- an indicative comparison of the total cost of the loan if the personal consumer continues with the existing tracker interest rate and the total cost of the loan for each of the alternative rate(s) and terms being offered. Any assumptions used must be reasonable and justifiable and must be clearly stated; and
- details of the advantages and disadvantages for the personal consumer of the tracker interest rate compared to each of the other rate(s) being offered.
The following warning statement should also appear with the information above, in circumstances where a personal consumer will not be able to revert to a tracker interest rate if they move to an alternative rate:
If you switch to an alternative interest rate, you will not be contractually entitled to go back onto a tracker interest rate in the future.
This provision does not apply to a mortgage on a primary residence covered by the Code of Conduct for Mortgages Arrears which is in “arrears” or “pre-arrears” as defined in the Code of Conduct for Mortgage Arrears.
A regulated entity must allow the personal consumer at least one month to consider any change proposed under Provision 6.9 and advise the personal consumer of this entitlement.
Where a personal consumer waives the one month period provided for in Provision 6.10, a regulated entity must receive written confirmation from the personal consumer, prior to the proposed change, confirming that:
- the personal consumer has been provided with the information required under Provision 6.9; and
- the personal consumer understands that he or she is waiving a one month period to consider this information.
Where a regulated entity offers an incentive to a personal consumer on an existing mortgage, the regulated entity must provide the personal consumer, on paper or on another durable medium, with the information needed to consider the incentive offered.
This information must:
- quantify the implications for the personal consumer of availing of the incentive including an indicative cost comparison of the total cost of the existing mortgage if they do not avail of the incentive and the total cost of the mortgage if they avail of the incentive;
- clearly set out the length of time during which the incentive will be available;
- clearly set out any assumptions used, which must be reasonable and justifiable;
- set out the advantages and disadvantages to the personal consumer of availing of the incentive;
- include other key information which the personal consumer should have available to them when considering the incentive; and
- include a statement that the personal consumer may wish to seek independent advice before availing of the incentive.
INSURANCE PRODUCTS (6.13 - 6.15)
An insurance undertaking must issue policy documents, within five business days of all relevant information being provided by the consumer and cover being underwritten, to any consumer to whom it has sold its insurance policy directly or to any insurance intermediary that has sold its insurance policy. An insurance intermediary must, within five business days of receiving the policy documents from an insurance undertaking, provide them to the consumer.
This provision also applies in the case where the consumer renews an existing policy.
When a consumer notifies a regulated entity of the intention to use an insured vehicle in another Member State, the regulated entity must provide the consumer with contact details of the regulated entity’s appointed claims representative for that Member State.
Where a secondary market exists for a life assurance policy, and when the holder of such a life assurance policy is a consumer and seeks information on its early surrender, the regulated entity must notify to the consumer, at the same time as it discloses the surrender value of the policy, that this secondary market exists and that the policy may be sold on it.
INVESTMENT PRODUCTS (6.16 - 6.17)
For each investment product held with it, a regulated entity must, at least annually, provide to a consumer a statement in respect of the previous 12 month period, which includes, where applicable:
- the opening balance or value;
- all additions including additional amounts invested;
- all withdrawals;
- the total sum invested;
- the number of units held;
- all interest;
- all charges and deductions affecting the investment product including any charges associated with the management, sale, set up and ongoing administration of the investment product; and
- the closing balance or statement of the value of the investment.
A product producer of a tracker bond must produce and issue a document, within five business days of the start of the tracker bond, to a consumer to whom it has sold its tracker bond or to an intermediary that has sold its tracker bond setting out:
- the name(s) and address(es) of the consumer(s);
- the date of investment;
- the amount of the investment;
- the date or dates on which the minimum payment is payable;
- disclosure of the make up of the investment, if the make up differs from that shown in the Key Features Document prepared in accordance with Provision 4.50;
- the date the investment will mature; and
- if a consumer has the right to cancel the tracker bond within a certain period of time from the sale, that the cooling off period of [Insert number] days starts from [insert date: the commencement of the investment date/date of receipt of policy document].
An intermediary must, within five business days of receiving this document, provide it to the consumer(s) who purchased the tracker bond.