The total number of casefiles formed at the end of the first half of (H1) 2023 reached 422, of which 418 involved banks, and 4 such casefiles concerned NBFIs (compared to the first six months of 2022, when 333 casefiles were formed, which means an increase of approximately 27% in the current year). Of the casefiles formed this year, 339 concluded with a resolution (the parties accepted the solution proposed by the conciliator), and additional 62 casefiles are still being processed/negotiated. In 18 cases, one of the parties rejected the solution the conciliator rendered and a report was issued, whereas in 3 cases, one of the parties withdrew. The share of cases concluded with a resolution further to negotiations (in which the parties accepted the solution proposed by the conciliator) is at approximately 95% (for the applications resolve in H1 2023).

During the first six months of 2023, as many as 339 consumers went through the entire conciliation process (application filing, negotiation, final resolution – a solution accepted by both parties), and 290 consumers reached an amicable settlement directly with banks/NBFIs, having first approached ABDRC. The situation is better than in the similar period/H1 of 2022, when 261 resolutions (an increase by approx. 30% of this statistical indicator) and 243 amicable settlements (an increase by 20% this year) were on record.

In the first six months of the year, 121 court cases were terminated because the parties wanted and managed to find an amicable solution with the help of ABDRC.

Starting with Q1 2020 legal entities can also refer to ABDRC cases related to payment services and electronic money issuing. ABDRC received 6 such applications during the reference period, but the financial institutions these were intended to turned down 4 of them, accepted one application, and one application became is still in screening.

The number of applications recorded in the first half of (H1) 2023 (1,572 applications) shows an increase of approximately 18% compared to the figure reported for H1 2022 (1,335 applications). This evolution is driven also by both the months of general rises in prices (considering the continued war being fought close to the borders of Romania), and the evolution of the ROBOR and IRCC indices, which are used to calculate the monthly payable instalments for the floating-interest loans. Many consumers experience genuine difficulties in making the due payments, and these justified circumstances require identification of solutions to rebalance the contractual obligations (with the applications being submitted directly to creditors, or via ABDRC).

Of the total number of applications received before the end of H1 2023, 1,028 concerned different matters in relation with banks (65% of the total), whereas 544 concerned different matters in relation with NBFIs (35% of the total).

Thus, compared to the end of H1 2022, the share of applications concerning intended to banks and NBFIs remained relatively flat (65% of total to banks and 35% intended to NBFIs).

In this statistical slot, we need to highlight also that, in the first six months of this year, the applications for deregistration from the Credit Register (CR) observed an evolution similar to that of the last year.

Thus, at the end of H1 2023, there were 628 applications for deregistration from the CR (198 intended to banks + 430 intended to NBFIs), while the number of this type of application observed in the entire 2022 was 1,034 (317 to banks and 717 to NBFIs). It should be recalled that most of the applications concerning issues in relation to the Credit Office, the First House programme or assigned loans are closed because, on a case-by-case basis, these are governed by a special piece of legislation which leaves but limited or even no room whatsoever for negotiation.

The total number of casefiles formed at the end of the first half of (H1) 2023 reached 422, of which 418 involved banks, and 4 such casefiles concerned NBFIs (compared to the first six months of 2022, when 333 casefiles were formed, which means an increase of approximately 27% in the current year). Of the casefiles formed this year, 339 concluded with a resolution (the parties accepted the solution proposed by the conciliator), and additional 62 casefiles are still being processed/negotiated. In 18 cases, one of the parties rejected the solution the conciliator rendered and a report was issued, whereas in 3 cases, one of the parties withdrew.

The share of cases resolved and concluded with a resolution (with the parties coming to terms) exceeds the figure of the similar period of last year. This year, the reported number of resolutions is 339, compared to the similar period of the previous year, when only 261 resolutions were reported (a 30% increase this year).

Furthermore, before the end of H1 2023, 290 applications were settled amicably by traders after the respective cases having been referred to ABDRC (traders negotiated directly with consumers), broken down as follows: 98 applications settled amicably with banks, and 192 applications settled amicably with NBFIs.

At the end of H1 2023, we counted approximately 540 enquiries made by phone, and 206 persons/consumers accessed the chat available on the ABDRC website.

The break-down of applications by banks/NBFIs is as follows:

Banks:

• 1,028 compliant applications;
• 157 non-compliant applications;
• 401 requests for miscellaneous information.

Classification of the 1,028 compliant applications:

• 418 cases created in the end of H1 2023;
• 95 applications in the screening phase – documents are being reviewed;
• 98 applications were settled amicably by the parties, but this after the consumer having first referred the case to ABDRC;
• 417 cases were closed;
• 8 applications are adjoined.

Classification of the 418 casefiles in the procedure with proposed solution/conciliation:

• 335 resolutions rendered – the parties reached an agreement;
• 62 cases in the processing phase;
• 18 reports – the parties did not come to terms;
• 3 casefile in which one of the parties withdrew.

Means of submitting compliant applications:

• 560 were submitted via the app (website);
• 424 were emailed;
• 10 were mailed;
• 34 were brought to, and registered by consumers with the office of ABDRC.

NBFIs:

• 544 compliant applications.

Classification of the 544 compliant applications:

• 4 cases formed at the end of H1 2023 (1 case created in 2023, arising from one application received before the end of 2022);
• 86 applications in the screening phase – documents are being reviewed;
• 192 applications were settled amicably between the NBFI and the consumers concerned, however after the consumer having first approached ABDRC;
• 263 were closed – rejected by the NBFIs.

Qualification of the 4 cases in the procedure with proposed solution/conciliation:

• 4 resolutions rendered – the parties reached an agreement;

Means of filing compliant applications:

• 484 were submitted via the app (website);
• 55 were filed by email;
• 1 was mailed;
• 4 were brought to, and registered by consumers with the office of ABDRC.

The applications received from consumers covered the following topics:

• Problems in connection with credit products:

• Refunds (of fees/commissions, interest);
• Shift from ROBOR to IRCC;
• Reduction of loan principal/debt/instalment, or writing off overdue amounts;
• Rescheduling/refinancing/staging-out;
• Agreement renegotiation/rebalancing (including for hardship);
• Credit Office (deregistration from CO);
• Finding a solution to address the problems (in general);
• Currency conversion;
• Problems with insurance policies (bancassurance);
• Interest recalculation;
• Payment commitments;
• Maturity acceleration;
• Removal of certain clauses.

• Operational problems:

• Problems with operation of the ATMs (including refunds);
• Problems in connection with wire transfers and refunds of transaction fees;
• Refunds in case of processing errors;
• Recovery of amount wrongly transferred by consumers (internet banking);
• Provision of clarifications about calculation of the amounts withdrawn by banks from the credit card account;
• Other card-related problems (cancellation/name change);
• Problems in connection with the exchange rate and interests charged when using the cards abroad;
• Problems regarding inter-banking transfers.

• Problems related to other types of activities:

• Problems related to forced execution (suspensions/stays of proceedings; attachments/payment commitments/discontinuation of forced execution);
• Requests to be issued documents (repayment schedules, statement of account, etc.);
• Refunds of garnished amounts;
• Mortgage deregistration;
• Bank fraud/fraud committed via bank channels.

The main reason for closing an application is the refusal of traders to have the dispute settle via ADR procedure, and the reasons for closing fall into several categories:

• Good reasons (main) – the application concerns:
  • there is a pending court case (appeal/higher appeal) and/or a final court judgment;
  • the selected trader is a third party for the consumer’s claims;
  • “First House” loans;
  • State premium under saving-lending contracts;
  • the petitioner is a legal entity, and the reported case falls outside the scope of Laws 209/2019 and 210/2019;
  • the consumer asks for confidential information, and its disclosure would come against the provisions of the Regulation no. 679/2016;
  • constraints enforced under the applicable special legislation – Card Organization Regulation.

• Reasons related to consumers:
  • the consumer failed to support their claims/to provide the information needed to have their claims settled, despite having been asked to supply it/the consumer withdrew.

NOTE:

The statistical data shows that the number of consumers who approached ABDRC in H1 2023 observed an increase in the current year (of approximately 18%) compared to H1 2022. If we are to relate to the cases solved (with resolutions or with amicable settlement further to a referral to ABDRC), the results at the end of H1 of this year are 25% better than in the same period of last year, with increase in both the number of cases formed, and the number of direct amicable settlements between the parties (having first approached ABDRC). This increase is driven including by the number of cases effectively settled and concluded with a resolution/the parties reaching an agreement (as an effect of the increased willingness of the parties to negotiate, as well as of the finetuning of the ABDRC conciliators’ skills).

CONCLUSIONS:

The ABDRC services continue to be accessed by increasingly more Romanians who have problems with their banks/NBFIs. Benefits of conciliation: the court proceedings are avoided and the contractual relations between parties continue, the short case settlement time (time average of 25 days/case in 2022), the procedure is free of charge for consumers; and the expertise of conciliators, are all important benefits for both consumers and the financial and banking institutions involved in these negotiations, particularly during economically difficult times (the effects of pervasive rise in prices, due to the war being fought close to the borders of Romania are acutely felt). In this context, the conclusions drawn for the first six months of 2023 are as follows:

• As many as 1,572 consumers have approached the Alternative Banking Dispute Settlement Centre (ABDRC) in the first six months of this year to find amicable solutions in their relations with banks and NBFIs. Compared to the similar period of 2022, consumers filed approximately 18% more applications;
  • The number of files formed in the first six months of this year it is growing compared to H1 2022: 422 cases/H1 2023 v 333 cases/H1 2022 (an increase of 27% this year);
  • The fact that the traders operating in the financial and banking system continued to welcome the amicable (direct) settlement further to a referral to ABDRC is another way of solving the claims raised by consumers, particularly when these claims concern simple matters and do not necessarily require the intervention/expertise of the ABDRC conciliators: 290 such cases/H1 2023 v 243 such cases at the end of H1 2022 (an increase by 20% this year);
  • The csalb.ro website offers a section dedicated to financial education, and ABDRC’s communication with consumers of financial services focused in 2022 and 2023 on this particular matter, which has become highly important in the context of these unpredictable economic and social developments;
  • Within the same boundaries of financial education, ABDRC launched a project of podcasts with top executives of commercial banks and journalists specializing in the financial and banking industry, as well as with editors-in-chief of some of the most important specialty publications. The materials are promoted both on ABDRC’s own channels (FB, LinkedIn, YouTube, Instagram, TikTok), as well as by care of the indicated publications and other TV, radio, or online press channels;
  • ABDRC also commenced a project where the conciliators of the Centre enter a live dialogue with consumers of financial services. These monthly talks are advertised and broadcasted on social media. Conciliators answer questions asked by consumers, and four such meetings took place in the first six months of 2023;
  • In the first 6 months, ABDRC produced more than 120 consumer financial awareness and education videos. The video productions were advertised in TV and online campaigns, on social media, on ABDRC’s own channels, as well as on the channels of the financial education projects’ media partners;
  • Another way of informing consumers is the ABDRC newsletter sent out to consumers of financial services who subscribed to receive this information;
  • Via its call-centre, CSALB contacts consumers who want this (having agreed to this in various social media campaigns) by phone. They receive information about an alternative procedure to settled their disputes with banks/NBFIs;
  • ABDRC produced and distributed flyers/leaflets to commercial banks to help consumers better understand the reconciliation process and how an application for negotiation with a bank should be filled out;
  • In the first 6 months of the year, 121 court cases were closed because the underlying disputes had been amicably settled via ABDRC, (compared to the 145 such cases reported for the entire 2022);
  • In the end of H1 2023, the negotiation procedures involving consumers and banks facilitated by ABDRC resulted into benefits in excess of EUR 1.4 million. Thus, the total amount of the benefits obtained (in all 7 years of operational activity of the Centre) is approximately EUR 9.4 million.
  • The share of cases concluded with a resolution further to negotiations (in which the parties accepted the solution proposed by the conciliator) is at approximately 95% (for the applications resolve in H1 2023). This process is solid evidence that the dispute amicable resolution mechanism does settle in the Romanian financial and banking market; it involved a number of actors: on the one hand, the banks and some NBFIs, and on the other hand, many consumers, as both parties realize the benefits of amicable resolution.

The WEBSITE www.csalb.ro makes available also for legal entities an online tool, which allows for faster and smoother submission of the conciliation applications. On the first page of the website, consumers are prompted to access this application by filling in an application. The documents entered in the registration form are uploaded into the app, and their processing time is approximately one hour. The application was setup in observance of the principles of the General Data Protection Regulation (GDPR).

The Alternative Banking Dispute Resolution Centre (ABDRC) is an independent non-governmental, apolitical, and not-for-profit legal entity of public interest established under the Government Ordinance no. 38/2015 on alternative resolution of disputes between consumers and traders, which transposes at domestic level Directive 2013/11/EU on alternative dispute resolution for consumer disputes and amending Regulation (EC) no. 2006/2004 and Directive 2009/22/EC.