Banks adopt a more personal approach to informing clients
Clients will soon be informed of any changes in the terms and conditions of banking services personally and two months in advance. The biggest change is that banks will start informing clients of changes in the terms and conditions 2 months in advance instead of the current 1 month. The new procedure also requires banks to inform clients personally in the future.
Until now information has mainly been given in national daily newspapers and at branches of banks, but banks will now proceed from the client’s habits and requests when giving information.
The amendments to the Law of Obligations Act will apply to the banks operating in Estonia from 22 May and these amendments mean that the terms and conditions of informing clients of changes in contract terms and conditions will also change in addition to the contracts of payment services (transfers, standing orders and direct debits, card transactions, etc.). The new Act is based on the Payment Services Directive of the European Union, which allows for a rather broad interpretation of the terms and conditions of informing. The Financial Supervision Authority, the Consumer Protection Board and the Banking Association worked out common standpoints in order to ascertain how informing clients could be organised in Estonia in the best possible manner.
As online banking is well developed and widely used in Estonia, then the common understanding was that sending notices on paper to inform clients would not be reasonable. In the future, banks will select the manner in which they inform clients depending on the nature of the information and the channels they can use include the Internet bank mailbox, e-mail, text messages and paper – both at branches and by post. Since the terms and conditions of products are often bulky and may of the selected channels set limits to the amount of information that can be sent, then notices will generally give clients a brief overview of the terms and conditions and the areas that are being amended, the nature of the amendments and the time when the amendments enter into force, and they will also inform clients where they can review the new terms and conditions in full. Terms and conditions will be made available in full on the websites and at the branches of banks.
Clients will be able to obtain detailed information about the new procedure and options of information exchange from their banks and they can also decide not to receive notices on the amendment of contract terms and conditions at all.