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AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
AFI CEMC WG - second meeting - presentation SdC
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AFI CEMC WG - second meeting - presentation SdC

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  • Recognize the work that the coordination group has done in the past 5 months and thank Bel, Hastings, McEwen, Antoine, Habasonda, Noor (and also Saied and Joao who could not attend today’s meeting) for the input in the production of the survey, the charter, and other documents, and the design of today’s meeting agenda.
  • 11 new membersAbsent: Joao (Brazil), Pungki (Indonesia), Sharon (Malaysia), (Guinee), Jan (NCR), Matu (CBK)Welcome new members:Ms Laura Monteiro from the BancoNacional de AngolaMs Shaohua Zhang from the People’s Bank of ChinaMs Betsy Garcia Rivas from the Superintendencia de GuatemalaMrBenigno Lopez from the Banco Central del ParaguayMs MillaGuillen from the Superintendencia de PeruMonsieur HadjiBiraneDiop du Ministere de l’Eco et des Fianances du Senegal
  • Recognize the work that the coordination group has done in the past 5 months and thank Bel, Hastings, McEwen, Antoine, Habasonda, Noor (and also Saied and Joao who could not attend today’s meeting) for the input in the production of the survey, the charter, and other documents, and the design of today’s meeting agenda.
  • Recognize the work that the coordination group has done in the past 5 months and thank Bel, Hastings, McEwen, Antoine, Habasonda, Noor (and also Saied and Joao who could not attend today’s meeting) for the input in the production of the survey, the charter, and other documents, and the design of today’s meeting agenda.
  • The findings of the survey will help CEMC Working Group members to: a) develop policy and regulation at the national level, b) identify common practices and challenges within the working group, c) narrow and refine the work priorities; and d) reach agreement on expected outputs.
  • CONSTITUTION regional relevance: Uganda and Zambia; Senegal; Mexico, Peru, Paraguay and Guatemala
  • “Other” has to be cleaned. Often repeating what is in previous answers.
  • Investigate more the interaction between access and protection, quality of access/protection and inclusion, and literacy and access.Interesting to see results of survey on literacy later, also, to be definitely considered in the follow up. In part differs from felt priority in the first meeting, when transparency rated 1st.
  • Slide 15 (“If market conduct standards are in place (either through legislation or regulations),which products/services are covered?”) – not a comment on the slide; but I am very surprised by some of the high percentages. It might be helpful to try to tease out (if time permits) respondents' understanding of “market conduct standards “ - and the sorts of standards which are in place.
  • I suspect Q11 response is misleading. Maybe it indicates that in 53% of cases there are some agency with dedicated consumer protection staff, including general / non-financial consumer protection agencies.
  • [The codes of conduct in 15 and 16 probably refer mostly to banking codes of conduct? How specific are these on consumer protection issues? 16A seems to indicate that the codes mostly deal only with generic issues, and not with specific consumer protection issues. A regional disaggregation of the responses would be interesting.]80% of countries have some kind of self-regulatory body. This probably refers mostly to bankers’ associations. [18]
  • How specific are these on consumer protection issues?
  • [20, 21, 21A, 23-2]. (also have a look at 27; This graph seems to expand on this issue, but mine is not clear enough to interpret)
  • Slide 40 (“23-2: What information is required to be disclosed to the client?Credit products”): I am sceptical about the accuracy of some of the responses – eg it appears that several countries mandate the disclosure of more than one of APR, EIR and TCC; and more than 50% say that they mandate the disclosure of cooling-off period, when slide 29 (“16A: What areas are covered?”) suggests that no Code contains provisions on cooling-off.
  • Very few countries prescribe the that the cost of money transfers must be disclosed in advertising, brochures or similar material. Disclosure is mostly limited to material provided at the branch or point of sale. [23-3, 23-4]. Greater focus on disclosure of money transfer cost in promotional material and cost may have significant benefit in increasing the level of competition.
  • [25, 25A]. (I wonder what the ‘other’ in 25A stands for?).
  • As [26, 26A]
  • The prioritisation graph [31] seems to indicate that most countries do not yet have specific plans in place to address weaknesses in transparency and disclosure (31 - could also be interpreted differently?)
  • [33A, 33B]
  • [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible. [34].Verify difference between civil law v common law jurisdictions. Likely the latter does not have this type if regulation. Also, Colombia’s regulators specified the abusive clauses in August 2011
  • Agenda setting and operazionalizationPresentation of proposed log-frameDiscussion of the CEMC WG expected outcomes and outputsCreation of subgroupsSub-groups discussionsCoffee breakNext stepsFinalization of log-frameFinalization of work plan (division of labor between subgroups, participation in relevant events, etc.)Agenda and logistic for the next meeting
  • GovernancePresentation of CEMC WG sessions at 2011 AFI GPFRelevance of the sessions and role of CEMC WG membersLunchAgenda setting and operazionalizationPresentation of proposed log-frameDiscussion of the CEMC WG expected outcomes and outputsCreation of subgroupsSub-groups discussionsCoffee breakNext stepsFinalization of log-frameFinalization of work plan (division of labor between subgroups, participation in relevant events, etc.)Agenda and logistic for the next meeting
  • Transcript

    • 1. The 2011 AFI Global Policy ForumConsumer Empowerment and Market Conduct (CEMC)working group meeting27 September, Riviera Maya, Mexico
    • 2. The CEMC WG from Malaysia to Mexico> 18 member organizations > Charter and concept note draftedestablished CEMC WG > Survey undertaken> Set objective > Coordination group functioning> Identified 4 priority areas > 18 member organizations> Agreed on content for charter and represented in the second meetingconcept note > CEMC is activated> Agreed to undertake member survey > The CEMC WG has a logo> Set up coordination group > and a work space: AFI Member Zone> Agreed on content for work plan Launch: KL, 7 April 2011 Second meeting: RM, 27 Sept 2011
    • 3. 28 AFI members represented in the CEMC WG> Banco Central del Paraguay > Central Bank of Tanzania> Banco Central do Brasil > CNBV, Mexico> Banco Nacional de Angola > Ministère de l’Economie et des Finances du> Bank al-Maghrib Senegal> Bangko Sentral ng Pilipinas > Ministry of Economic Development and> BCEAO Trade, Russia> Bank Indonesia > National Bank of Rwanda> Bank Negara Malaysia > National Credit Regulator, South Africa> Bank of Thailand > Palestine Monetary Authority> Bank of Uganda > People’s Bank of China> Bank of Zambia > Reserve Bank of Malawi> Banque Centrale de la Rép. de Guinée > State Bank of Pakistan> Banque Centrale du Congo > Superintendencia de Peru> Central Bank of Armenia > Superintendencia de Guatemala> Central Bank of Kenya> Central Bank of Liberia New members in yellow/green
    • 4. Agenda Time Item for discussion Welcoming remarks and meeting kick-off Review of the agenda and meeting goals 9.00 – 9.30 Review of preparatory documents Updating each other on country initiatives CEMC WG members survey9.30 – 10.30 Presentation and discussion of intermediate results of the CEMC WG survey10.30 – 11.00 Coffee break The G20 High-level Principles on Financial Consumer Protection and their implementation11.00 - 12.00 Discussion of impact of the Principles on the work of the CEMC WG members and the possible role of the CEMC in their implementation Governance Election of CEMC WG chairperson (and eventually a co-chair)12.00 – 12.30 Announcement of new chairperson Discussion and approval of CEMC WG seminal documents (concept note and charter) Presentation of CEMC WG sessions at 2011 AFI GPF12.30 – 12.45 Relevance of the sessions and role of CEMC WG members12.45 – 14.00 Lunch Agenda setting and operazionalization Presentation of proposed log-frame14.00 – 15.00 Discussion of the CEMC WG expected outcomes and outputs Creation of subgroups14.00 – 15.45 Sub-groups discussions15.45 – 16.00 Coffee break Next steps Finalization of log-frame16.00 – 17.00 Finalization of work plan (division of labor between subgroups, participation in relevant events, etc.) Agenda and logistic for the next meeting Closing
    • 5. Priority areas MARKET CONDUCT> i) transparency and disclosure> ii) sales and marketing practices CONSUMER EMPOWERMENT> iii) avenues for help and redress> iv) financial literacy, capability and awareness
    • 6. CEMC WG’s objectives> To promote the adoption of evidence based policy and regulatory solutions for the empowerment and protection of financial consumers, which is also correlated with improving access to finance and the quality of financial inclusion> To develop a set of core principles/guidelines for financial consumer empowerment and protection policymaking> To support the design and validation of tools for policy analysis and policymaking for use by working group members
    • 7. Meeting goals> To present the preliminary results of the members’ survey and agree on the next steps> To discuss the potential role in the implementation of the G20 Principles> To elect the chairperson> To approve the charter and concept note> To find agreement on the expected outcome and outputs> To establish subgroups> To design the CEMC WG’s log-frame> To revise the work plan
    • 8. Preparatory documents> First meeting minutes and list of participants> Second meeting agenda> Second meeting participants list> Consolidated results of CEMC WG survey> Draft CEMC WG concept note> Draft CEC WG charter> Draft G20 High-level principles on financial consumer protection
    • 9. Members’ update> Central Bank of Uganda visited Mexico and Peru and released new National Framework on Financial Literacy and Financial Consumer Protection> Koid Swee Lian, AFI Policy Champion and CEMC WG founder, appointed CEO of the Malaysia AKPK> Others?
    • 10. Session ICEMC WG members survey Preliminary results > Scope of the analysis > Survey objectives > Respondent demographics> Preliminary results and observations > Survey trends > Roadmap to good policy practices
    • 11. CEMC WG survey: scope of the analysis Good Gather policy respective market data practices Self-diagnose priority Measure impact policy of policies and objectives regulations on market and consumers Survey peers to determine common practices and challenges
    • 12. CEMC WG survey: objectives> To gain a better understanding of WG members experiences, current plans, and challenges ahead related to the WG’s four priority areas> To provide a foundation from which WG members can self-diagnose their respective policy approaches, to determine how to best enable safe and sustainable policy and regulatory frameworks for financial inclusion> To inform the development of a road map towards good policy practice for consumer empowerment and market conduct
    • 13. CEMC WG survey: respondents demographics Angola BCEAO 17 RD Congo countries Africa Kenya Malawi Senegal Uganda 11 3 3 Zambia Guatemala 17 central banks ministries banks regulators MexicoTotal LAC Paraguay Peru MENA Palestine Armenia 2 billion China people ECA Philippines Russia
    • 14. NUMBER OF AGENCIES WITH RESPONSIBILITY CEMC WG survey: demographics > 45 (average 2.6 per country) > Mostly central banks and ministries, but also capital market authorities, insurance authorities, consumer protection agencies, and few microfinance authoritiesResponding Country Agency 1 Agency 2 Agency 3 Agency 4Angola Instituto Nacional de Defesa do Consumidor Banco Nacional de Angola (INADEC)China State Administration for Industry &CommerceDR Congo Banque Centrale du CongoGuatemala Dirección de protección al consumidor (Ministerio de Economía)Kenya Central Bank of Kenya Capital Markets Authority Retirement Benefits Authority Insurance Regulatory AuthorityMalawi Reserve Bank of MalawiMexico Central Bank (BANCO DE MEXICO) National Banking and Securities Commission National Commission for the Protection of Insurance and Surety National Commission (CNBV) Users of Financial Services (CONDUSEF) (CNSF) / Institute for the Protection of Banking Savings (IPAB)Palestine Palestine Monetary AuthorityParaguay Banco Central del Paraguay Instituto Nacional de Cooperativismo Ministerio de Industria y ComercioPeru Department of Products and Services to National Institute for the Defense of Financial Ombudsman Service Competition and Intellectual Property Protection (Indecopi)Philippines Bangko Sentral ng Pilipinas Securities and Exchange Commission Philippine Deposit Insurance Corporation Insurance CommissionRepublic of Central Bank of ArmeniaArmeniaRussian Federal Service on Consumers Rights Ministry of Finance of the Russian Federation Ministry for Economic Development of the Federal Financial Markets Service Russian FederationFederationSenegal Direction de la Réglementation et de la Direction de la microfinance (DMF) Banque Centrale des Etats de lAfrique de Observatoire de la Qualité des Services supervision des systèmes financiers lOuest (BCEAO) Financiers (OQSF) décentralisés (DRS-SFD)Uganda Bank of Uganda Capital Markets Authority Uganda Insurance Commission Ministry of Finance, Planning and Economic Development, Department of MicrofinanceWAEMU - UEMOA Central Bank of West African States (BCEAO) Banking Commission Microfinance Departments of Ministers of FinancesZambia Bank of Zambia Pensions and Insurance Authority Securities and Exchange Commission Competition and Consumer Protection Commission
    • 15. CEMC WG survey: categories INSTITUTIONAL LANDSCAPE > Mandate > Interagency coordination > Consultative approach MARKET CONDUCT > Regulation > Oversight > Remedial actions > Enforcement > Self-regulation > Transparency and disclosure > Sale and market practices > Ancillary areas CONSUMER EMPOWERMENT > Avenues for help and redress > Financial literacy, capability and awareness
    • 16. MANDATE – MARKET CONDUCTWhat are the main functions of the agencies? Most commonly, the involved agencies cover the three functions: regulating, supervising, and enforcing market conduct regulation Often the legal basis is the central bank law and the banking law. In a few cases the mandate is embedded in the constitution
    • 17. MANDATE – CONSUMER EMPOWERMENTWhat are the main functions of the agencies? Agencies answer consumer queries and often play a role in delivering programs to increase consumer’s awareness. Debt counseling is commonly left to specific agencies.
    • 18. PARTICIPATIVE APPROACHDo advocacy groups have a formal role? Consumer advocacy organisations play a fairly limited role in the In designing and policymaking and regulatory process. implementing In nearly 50% of the countries, consumer consultation with consumer advocacy empowerment policies and groups play no role. market conduct regs Only in two countries the advocacy groups have a further role helping consumers to file complains. In less than 30% of the countries they Financial have any formal roles, education responsibilities, or duties related to consumer education
    • 19. LANDSCAPEThe two main weaknesses and priorities over the next year The assessed primary weaknesses in the financial sector are overwhelmingly: - the limited access to (formal) financial products; and - the low level of financial literacy. This doesnt imply that each area not flagged by a country is necessarily fully satisfactory. In terms of priorities, the dominant priority is to increase financial literacy. The second is to increase protection for bank clients (only ½ the level of support as for financial literacy).
    • 20. MARKET CONDUCT – LEGAL BASISWhat legal documents govern market conduct regulation? Relevant legal provisions are most often found in either general consumer protection legislation or in financial sector regulations. Combining these answers with other questions, likely other legal acts (on payment systems, credit bureaus, insurance, pensions, and securities) may include market conductMarket conduct provisions are provisions; and these laws oftendiffused in multiple laws. contain conflicting provisions.Most countries do not havespecific legislation for financialconsumer protection.
    • 21. MARKET CONDUCTWhich products and providers are covered? Formal lenders and deposit takers are likely to be regulated. Not the market of mobile financial services. Why? Hypothesis: a) it’s less risky b) it’s too new – there is no sectoral regulation
    • 22. MARKET CONDUCTWhich areas are covered? The focus of market conduct regulations is on disclosure of the cost of financial services. A minority of countries also provide for complaints handling and redress mechanisms and for disclosure in advertising.However, almost all areas are covered, so there are anumber of members from whom lessons can potentially belearned.
    • 23. MARKET CONDUCT – OVERSIGHTWhat market conduct oversight activities can be undertaken? Limited use of specific market conduct oversight techniques such as media monitoring and mystery shopping. Why?
    • 24. MARKET CONDUCT – OVERSIGHTNumber of inspections conducted in one yearIn-site Although on- and off-site inspections are the primary compliance monitoring tools, 65% of countries does not have a specific audit or inspection programme for consumer protection monitoring. This may be an area where substantial improvement can be made in the short term. Is there a specific checklist or auditing programOff-site that focuses on consumer protection issues?
    • 25. MARKET CONDUCT – OVERSIGHTDedicated staff Are there dedicated staff responsible for market conduct supervision at any of the agencies you identified in question 1? In half of the countries the answer is positive Is market conduct supervision a general duty of supervisory staff (e.g. banking department) in the course of normal inspections? In more than 80% of the countries, yes. This could be a point of consensus in making future recommendations (w development of adequate tools)
    • 26. MARKET CONDUCT – REMEDIAL AND ENFORCEMENT ACTIONS What is the nature of the enforcement action? In most countries, remedial action on consumer protection issues is limited to letters of warning, although 65% of countries does have the power to issue monetary fines for non- compliance.Number of times this action of this type was taken in 2010 Your answers seem to indicate that 55% of the countries have issued between 1 and 5 fines for market conduct compliance Surprisingly high
    • 27. MARKET CONDUCT – SELF-REGULATION Standards/codes of conductAre there industry codes of conduct in yourcountry which identify specific market conduct The majority of the countriesstandards? have codes of conduct. In those cases, the regulators has often endorsed the code,If so, has the regulator endorsed the code of which is enforced by a third-conduct? party.And, is there a self-regulatory body (or bodies) thatis responsible for enforcing of the standards?
    • 28. MARKET CONDUCT – SELF-REGULATION Standards/codes of conductThe codes of conducts probably refer mostly to banking codes of conduct (followedby insurance).It seems that the codes mostly deal only with generic issues, and not with specificconsumer protection issues. Which products/services are covered? What providers are required to comply? What types of providers have to comply with What areas are covered? the standards or codes of conduct?
    • 29. MARKET CONDUCT – PRICING, TRANSPARENCY & DISCLOSURE Does your country have transparency & disclosure regulations?Does your country have transparency and disclosureregulations? Most countries do have some form of transparency regulation, mostly focused on interest or cost calculation. However, there is no uniformIs a specific format mandated for loan documentation? approach in calculating the cost of credit (see next slide) Only a minority of countries have a requirement forIs there a standard template for either the standard pre-agreementdisclosures or the contract that isendorsed by the regulator? disclosure for financial service contracts. This may require attention in conforming to the G20 principles.
    • 30. MARKET CONDUCT – PRICINGPrice calculation formula mandated for credit products What specific charges and fees are included in the formula?
    • 31. MARKET CONDUCT – TRANSPARENCY & DISCLOSURE - DEPOSIT AND SAVINGS PRODUCTSWhat information is required to be disclosed to the client? (Before Sale *)
    • 32. MARKET CONDUCT – TRANSPARENCY & DISCLOSURE – CREDIT PRODUCTSWhat information is required to be disclosed to the client? (Before Sale *)
    • 33. MARKET CONDUCT – TRANSPARENCY & DISCLOSURE – MONEY TRANSFERSWhat information is required to be disclosed to the client? (Before Sale *)
    • 34. MARKET CONDUCT – TRANSPARENCY & DISCLOSURE – PAYMENT SERVICESWhat information is required to be disclosed to the client? (Before Sale *)
    • 35. MARKET CONDUCT – TRANSPARENCY & DISCLOSURE – E-MONEYWhat information is required to be disclosed to the client? (Before Sale *)
    • 36. MARKET CONDUCT – PRICING AND TERMS AND CONDITIONS OF COMPARABLE PRODUCTS/PROVIDERSIs the information provided to consumers? Around 50% of countries publish some comparative information on the pricing or terms and conditions of financial services. This is mostly published in the central bank website. If it is recognized the If yes, where? importance of this information for customers, how to make it available to the majority of the clients?
    • 37. MARKET CONDUCT – TRANSPARENCY AND DISCLOSUREContinuing information to customersIs the provider required to provide periodic If yes, what is the due communication?information to the client regarding theirdeposits/savings?Around 75% of countries require periodic disclosure ofinformation on deposit or savings accounts, mostlythrough disclosure in account statement
    • 38. MARKET CONDUCT – TRANSPARENCY & DISCLOSUREWhat are two main priorities for the next year? 53% To ensure transparency and effective disclosure in transactions with banks 29% To identify cost-effective tools to provide to the public information on pricing and terms and conditions of comparable products/providers
    • 39. MARKET CONDUCT – SALES AND MARKETING PRACTICESIs there any regulations for sales and marketing practices? More than 40% of countries have no regulation on sales and marketing practices.
    • 40. MARKET CONDUCT – SALES AND MARKETING PRACTICESWhat conducts and providers are regulated? Restrictions to prevent personal data related to a consumer from being shared with external parties Obligation to verify credit history of consumer before selling a credit product Obligation to verify repayment capacity of the consumer before selling a credit product Prohibition of unfair, deceptive or aggressive practices Suitability of products and services for the consumer Prohibition on reckless lending It seems that banks and NBFIs covered similarly
    • 41. MARKET CONDUCT – SALES AND MARKETING PRACTICESIs there any regulatory provision that mandates To what providers does this apply?the provider:To train staff on responsible sales practicesTo supervise staff on responsible sales practices
    • 42. MARKET CONDUCT – SALES AND MARKETING PRACTICESThe two main priorities for the next year Suitability of products and services for the consumer Obligation to verify repayment capacity of the consumer before selling a credit product Obligation to verify credit history of consumer before selling a credit product
    • 43. MARKET CONDUCT – ANCILLARY AREAS Credit bureausCredit information sharing and credit bureaus: Describe the nature of creditinformation sharing, in relation to the statements below. Many countries have implemented credit information sharing initiatives, although participation is mostly limited to banks. In most cases MFIs are not included in the credit bureau system (see next).
    • 44. MARKET CONDUCT – ANCILLARY AREASCredit bureausFor "These institutions report information to the For "These institutions have access to thecredit bureau", please select : collected information", please select :
    • 45. MARKET CONDUCT – ANCILLARY AREASAbusive clausesAbusive clauses: Is there any clause, term, or condition that,if inserted in a contract, is automatically considered void or“deemed unwritten”? Only a minority of countries have any specific limitations on unfair contract terms. This may be an area where significant improvement is possible.
    • 46. MARKET CONDUCTThe main priorities for the next yearIn your country, what are the four main priorities for the next yearfor enhancing market conduct policy and regulatory framework?Please select up to four priorities, with 1 being the highest priority.
    • 47. CONSUMER EMPOWERMENTComplaint handling and redress mechanismsDo consumers have access to affordable and Is the access to affordable and efficientefficient complaint handling and redress complaint handling and redress mechanisms amechanisms in your country? statutory right in your country?
    • 48. CONSUMER EMPOWERMENTComplaint handling and redress mechanisms For each of the help and redress mechanisms listed in the table below, indicate whether a solution is in place.
    • 49. CONSUMER EMPOWERMENTComplaint handling and redress mechanisms What types of clients can file a complaint?
    • 50. CONSUMER EMPOWERMENTComplaint handling and redress mechanisms The decisions of the regulators and/or ombudsmen binding upon
    • 51. CONSUMER EMPOWERMENT - DEBT COUNSELINGIs there any agency that offers debt counseling?
    • 52. CONSUMER EMPOWERMENTComplaint handling and redress mechanismsIn your country, what are two main priorities for the next to provide consumersaccess to affordable and efficient complaint handling and redress mechanisms?Please select up to two priorities.
    • 53. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacyIs there a national strategy to enhance the Does the regulator have a statutory responsibility tofinancial literacy, capability and awareness of promote consumer literacy, capability andconsumers? awareness with respect to financial services?Does the regulator undertakes programmes Is there a special unit or dedicated staff responsibleto promote consumer literacy, capability for financial consumers’ literacy, capability, andand awareness with respect to financial awareness?services?
    • 54. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacyPlease indicate whether any of the following Please indicate whether any of the followinginstruments are used to promote financial instruments are used to promote financialconsumer literacy, capability and awareness by consumer literacy, capability and awareness bythe financial sector regulator or another the financial institutions:government agency:
    • 55. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacy Has the level of financial literacy in your country been formally measured?
    • 56. CONSUMER EMPOWERMENT – STRATEGIES, MANDATES, and TOOLS Do financial consumers’ literacy, capability, and awareness programs target unbanked or low-income people?
    • 57. MARKET CONDUCT Has your institution ever evaluated the effectiveness of its financial literacy, capability, and awareness initiatives?
    • 58. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacy What constraints and limitations keep your institution from promoting financial literacy, capability, and awareness?
    • 59. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacy Over the next year, what are the main priorities for your country in reference to financial consumers’ literacy, capability and awareness?
    • 60. CONSUMER EMPOWERMENTStrategies, mandates, and tools for financial literacy > No clear mandate > A few countries have clear strategies > But you all are doing that! > Without a baseline > Using different tools, implementing many different projects > But without knowing their effectiveness > With lack of financial resources (for the reasons above?) > And scarce collaboration with private sector and advocates groups
    • 61. Session II G20 High-level principles on financial consumer protection > Impact on CEMC WG members> Possible role of the CEMC WG in the implementation of the principles
    • 62. Purpose of the sessionPresent> Overview of the G20 Principles on Financial Consumer ProtectionComment from members of the Working Group> Any areas of the G20 Principles which may be difficult to implement;> or is inconsistent with reality in particular countries;> or is silent on an aspect of consumer protection which is a pressing concern?Views and suggestions> What next? Any issues to take forward? How? Level of priority?
    • 63. Framework for PrinciplesWhat are the objectives of financial consumer protection?What are the objectives of the G20 Principles?> Covering all areas of financial services> Consumer confidence in financial services, to promote growth & stability> Respond to: Increased transfer of risk to consumes; complexity of products;> Rapid changes & new (non-bank) providers & intermediaries> While financial access & literacy remain low> Voluntary principles, designed to complement sector-specific guidelines (IOSCO / BSBS / IAIS)> Principles may need to be adapted to national or sectoral circumstances
    • 64. Draft Principles – 11. Legal & Regulatory Framework> “integral part of the legal & regulatory framework”> “legal & judicial mechanisms to protect against financial fraud & abuses”> Appropriate regulation & supervision of service providers, agents & advisors> Consultation with industry, consumer bodies, professional bodies & research institutions2. Role of oversight bodies> “Must be oversight bodies with explicit responsibility for financial consumer protection”> Independence, accountability, resources, powers …> Mechanism for effective cooperation between oversight bodies
    • 65. Draft Principles3. Equitable & fair treatment for consumers> “Should be part of the corporate culture of financial service providers> “Similar protection for similar products & services> “Special attention to vulnerable groups4. Disclosure & transparency> “Provide key information on benefits, terms, risks, costs> “intermediary remuneration & conflicts> “Standard pre-contractual disclosure promoted> Health warnings (& information) on risky products> Requirements on providers of advice
    • 66. Draft Principles5. Financial Education & Awareness> “Promote education & awareness> Information on consumer rights easily accesible> Recommend implementation of OECD Guidelines & Principles> Special focus on vulnerable groups6. Responsible business conduct of Financial Service Providers & their agents> “Providers accountable for action of their agents> Objective of engagement with consumers: “best interest of clients”; “assess capabilities & needs of clients”, before providing products or services> Staff properly trained> Avoid / disclose conflicts of interest> Remuneration structure encourage responsible business conduct
    • 67. Draft Principles7. Protection of Consumer Rights> “Protect rights to deposits, savings & similar products> High degree of certainty; appropriate mechanisms8. Protection of consumer data & privacy> “Through appropriate mechanisms> Define purpose of collection; processing & disclosure> Right of consumers to be informed (of data sharing), have access their data; data corrected or deleted
    • 68. Draft Principles9. Complaints handling> “Redress mechanisms … accessible, cheap, effective etc.> Publish complaints statistics> Providers & agents to provide first line of complaints & redress> Independent process available of not resolved10. Competition> “National & international competitive markets, for choice & price competition> Allow consumers to search & switch
    • 69. Draft Principles Principles ???? 1. Legal & regulatory framework  Any of these inappropriate? 2. Oversight bodies 3. Equitable & fair treatment  Any important issues missing? 4. Disclosure & transparency 5. Education & awareness  Conflict with financial 6. Responsible Business Conduct inclusion? 7. Protection of consumer rights 8. Protection of data & privacy  Challenges in implementation? 9. Complaints handling 10. Competition … what next?
    • 70. Related developments to considerFSB: “Consumer Finance Protection - consumer credit & mortgages - financial stability aspects - assessment of current practices • Implications? Issues:-• Current consumer protection frameworks in credit & “consumer protection authorities” • Concerns?• Engaging with consumer advocacy groups• Competing objectives (prudential / protection); Independence & accountability • Suggestions?• Enforcement• Complaints & dispute resolution• Responsible mortgage lending practices = main issue• Product regulation• Unfair selling practices• Disclosure & transparency
    • 71. Any other issues in this respect? • ???? What • ???? To • ???? • ???? Do?
    • 72. Session III CEMC WG’s Governance > Election of CEMC WG chairperson > Announcement of new chairperson> Discussion and approval of CEMC WG seminal documents
    • 73. GovernanceELECTED CHAIR> Bangko Sentral ng PhilipinasELECTED CO-CHAIR> Central Bank of UgandaSEMINAL DOCUMENTS> The CEMC WG members approve the charter and conceptnote
    • 74. Session IVCEMC WG’s sessions at the 2011 AFI GPF > Session on financial literacy > Session on transparency
    • 75. Thursday, 29 September, 17.00h – 18.30hFinancial literacy and financial inclusionFACILITATOR> Ahmed Dermish, BFAPANELISTS> Bipin Nair, Reserve Bank of India> Giovanna Priale, SBS Peru> (TBC)SESSION OBJECTIVES> To increase understanding of the relationship between financial literacyand inclusion> To gain a better understanding of the role of policymakers/regulators> To identify cost-effective tools to increase the level of literacy> To provide input into the AFI CEMC WG’s work on this topicFORMAT> Advisory teams
    • 76. Friday, 30 September, 9.30h – 10.45hImproved transparency standards for financial inclusionMODERATOR> Shaun MundyPANELISTS> Antoine Traore, BCEAO> Hastings Mzoma, Central Bank of Malawi> Belinda Caraan, Bangko Sentral ng Philipinas> Gaiv Tata, the World Bank> Katherine McKee, CGAP> Gabriel Davel, AFI AssociateSESSION OBJECTIVES> To identify key issues in pricing and transparency> To discuss regulatory approaches and good practices re: transparency> To provide input into the AFI CEMC WG’s work on this topicFORMAT> Talk show
    • 77. Session V Agenda setting and operationalization> Presentation of proposed log-frame > Creation of subgroups
    • 78. Log-frame: templateIntervention What should it show: It answers the question: logic Change of state and improvedImpact/Goal What is our vision of the future? situation Situational or behavior change Where would we like to get to inOutcomes or improvement that is the next 5 years? necessary to reach the impact The tangible products, services, What are the main things that and results delivered which need to be delivered (in the Outputs needs to be achieved to bring next year) by the working group about the outcome to achieve the vision? Tasks that have to be What needs to be done to Activities undertaken to deliver the deliver each of these outputs? desired outputs
    • 79. Subgroups 5 subgroupsTransparency Sales and Avenues for Financial Harmonizationand disclosure marketing help and education of guidelines practices redress Guatemala Tanzania Liberia x Pakistan x Armenia x Peru x Palestine x Russia RDC Thailand BCEAO Philippines Senegal Mexico Paraguay China Malawi Zambia Uganda Angola x = focal point
    • 80. Session VI Sub-groups discussions> Discussion of expected outcomes and outputs > Discussion of work plan
    • 81. Session VII Next steps > Finalization of log-frame > Finalization of work plan> Agenda and logistic for the next meeting
    • 82. CEMC WG’s log-frame Improved capacity of policymakers to design and implement effective policies to protect Goal and empower consumers Guidelines on four priority areas for Consumer Empowerment and Market Conduct endorsed by AFI network membersOutcome Relevant international frameworks (standards, principles, etc.) are better harmonized CEMC WG members recognized as leaders in consumer empowerment and market conduct Developed evidence based policymaker’s guidelines in four priority areas Produced report on country experiences Improved capacity of CEMCWG members to assess and analyze solutions and mechanisms for consumer protection and market conductOutputs Identified and documented cost-effective tools that deliver information and enable redress for the poorest segment of the population Increased awareness among other policymakers and international stakeholders about CEMCWG lessons and solutions Develop and complete stocktaking survey Conduct Knowledge Exchange visits between CEMC WG members Undertake diagnostic study on selected CEMC WG members countriesActivities CEMCWG members present experiences and lessons learned in selected external forums Hold peer learning workshop on diagnostic tools and methodologies, and policy solutions, with strategic partners Peer reviews of draft policies and regulations Transparency and disclosure MARKET CONDUCT4 priority Sales and marketing practices areas Avenues for help and redress CONSUMER EMPOWERMENT Financial education
    • 83. Transparency and disclosures subgroup’s log-frame Developed evidence based policymaker’s guidelines in the area of transparency, with focus on cost-effective access to disclosed information (e.g. re: channels, standard contract for basic products, code of conducts, comparable information of basic products)Outputs Produced report on transparency based on the results of the stocktaking survey Identified and documented cost-effective tools that deliver information, also for the poorest segment of the population Analyze transparency section of the stocktaking surveyActivities Identify common challenges and good practices Undertake diagnostic study on selected CEMC WG members countries Superintendencia de Guatemala Superintendencia de Peru (coordinator)Members BCEAO People’s Bank of China Central Bank of Uganda
    • 84. Sales and marketing practices subgroup’s log-frame Developed evidence based policymaker’s guidelines in the area of sales and marketing practices Produced report on sales and marketing practices based on the results of the stocktakingOutputs survey Identified and documented cost-effective tools that deliver information, protect, and empower consumers, also for the poorest segment of the population Analyze sales and marketing practices section of the stocktaking surveyActivities Identify common challenges and good practices Undertake diagnostic study on selected CEMC WG members countries Central Bank of TanzaniaMembers Palestine Monetary Authority (coordinator) Bangko Sentral ng Philippinas
    • 85. Help and redress subgroup’s log-frame Developed evidence based policymaker’s guidelines on help and redress mechanisms Produced report on avenues for help and redress mechanisms based on the results of the stocktaking surveyOutputs Identified and documented cost-effective tools that protect and empower consumers providing access to cost-effective help and redress mechanisms, also for the poorest segment of the population Analyze relevant section of the stocktaking surveyActivities Identify common challenges and good practices Undertake diagnostic study on selected CEMC WG members countries Central Bank of Liberia (coordinator)Members Ministry of Economic Development of Russia Ministere de Finances du Senegal
    • 86. Financial education subgroup’s log-frame Developed evidence based policymaker’s guidelines on financial education, with focus on the development of national strategiesOutputs Produced report on financial education based on the results of the stocktaking survey Identified and documented cost-effective tools that deliver financial education, also for the poorest segment of the population Analyze relevant section of the stocktaking surveyActivities Identify common challenges and good practices Undertake diagnostic study on selected CEMC WG members countries State Bank of Pakistan (coordinator) Banque Centrale du CongoMembers CNBV Mexico Reserve Bank of Malawi National Bank of Angola
    • 87. Harmonization of guidelines subgroup’s log-frame Identified and documented problems with concurrent internationally adopted frameworksOutputs (of standards, principles, and indicators) used to assess consumer empowerment policies and market conduct regulations in AFI member countries Analyze relevant frameworksActivities Identify common challenges due to the co-existence of concurrent frameworks Provide guidance to the other 4 CEMC WG sub-groups Central Bank of Armenia (coordinator) Central Bank of ThailandMembers Banco Central do Paraguay Bank of Zambia

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