During the first nine months of 2023, as many as 917 consumers went through the entire conciliation process (application filing, negotiation, final resolution  a solution accepted by both parties in 475 cases), or reached an amicable settlement directly with banks/NBFIs, having first approached ABDRC (in 442 cases). The situation is better than in 2022 (up by 11%) when, during the same period, 823 Romanians were reported in one of these two situations. In the first three quarters of the year, 184 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 5 such applications during the reference period, but the financial institutions these were intended to turned down 4 of them, and only one application became a case and concluded with a report.

The number of applications recorded Q3 2023 (2,209 applications) shows an increase in the current year of approximately 10% compared to Q3 2022 (2,002 applications). This organic evolution is driven also by both the months of general rises in prices (particularly after the onset of the war very close to Romania), and the evolution of the ROBOR and IRCC indices, which is 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 Q3 2023, 1,410 concerned different issues in relation with banks, whereas 799 concerned different issues in relation with NBFIs.

Thus, compared to the end of Q3 2022, the share of applications intended at NBFIs has stayed relatively flat: from 34.8% of total/2022 down to 36% of total/2023.

Moreover, the share of applications intended at banks is has also remained similar during the two compared periods: 65.2% of the total/at the end of Q3 2022, and 64% of the total/at the end of Q3 2023.

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

At the end of Q3 2023, we see 949 applications for deregistration from the CR (305 intended at banks + 644 intended at NBFIs), while the number of this type of application observed at the end of Q3 2022 was 998. 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 Q3 2023 reached 575, of which 571 involved banks, and only 4 such casefiles concerned NBFIs (compared to the first nine months of 2022, when 506 casefiles were formed, which means an increase of 14% in the current year). Of the casefiles formed this year and settled until the end of the reference period, 475 concluded with a resolution (the parties accepted the solution proposed by the conciliator), and additional 60 casefiles are still being processed. In 36 cases, one of the parties rejected the solution the conciliator rendered and a report was issued, whereas in 4 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 475, compared to the similar period of the previous year, when only 395 resolutions were reported (a 20% increase this year).

Furthermore, before the end of Q3 2023, 442 applications were settled amicably by traders after the respective cases had been referred to ABDRC (traders negotiated directly with consumers), broken down as follows: 147 applications settled amicably with banks, and 295 applications settled amicably with NBFIs.

In the end of the Q3 of this year, we counted approximately 1,700 enquiries made by phone, and 285 persons/consumers accessed the chat function on the website of ABDRC.

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

Banks:

• 1,410 compliant applications;
• 270 non-compliant applications;
• 759 requests for miscellaneous information.

Classification of the 1,410 compliant applications:

• 571 casefiles formed at the end of Q3 2023 (7 casefiles are formed in 2023 from applications received at the end of 2022);
• 81 applications in the screening phase – documents are being reviewed;
• 147 applications were settled amicably by the parties, but this after the consumer having first referred the case to ABDRC;
• 610 cases were closed;
• 8 applications were joined.

Classification of the 571 casefiles in the procedure with proposed solution/conciliation:

• 471 resolutions rendered – the parties reached an agreement;
• 60 cases in the processing phase;
• 36 reports – the parties did not come to terms;
• 4 casefile in which one of the parties withdrew.

Means of filing compliant applications:

• 777 were submitted via the app (website);
• 568 were emailed;
• 18 were mailed;
• 47 were brought to, and registered by consumers with the office of ABDRC.

NBFIs:

• 799 compliant applications.

Classification of the 799 compliant applications:

• 4 cases formed at the end of Q3 2022 (1 case created in 2023, arising from one application received before the end of 2022);
• 62 applications in the screening phase – documents are being reviewed;
• 295 applications were settled amicably between the NBFI and the consumers concerned, however after the consumer having first approached ABDRC;
• 439 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 submitting compliant applications:

• 713 were submitted via the app (website);
• 81 were filed by email;
• 1 were 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:

• • Credit Office (deregistration from CO);
  • 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);
  • Finding a solution to address the problems (in general);
  • Conversion of the loan currency;
  • 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 in connection with forced execution (suspensions/stays of proceedings);
  • Requests to be issued documents (repayment schedules, statement of account, etc.);
  • Refunds of garnished amounts;
  • Mortgage deregistration;
  • Banking fraud.

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:
  • deregistration of entries from the Credit Office;
  • “First House” loans;
  • assigned claims;
  • the state premium under saving-credit contracts.

• Reasons related to consumers:
  • selection of a trader the business of which is not regulated by the National Bank of Romania;
  • selection of a trader they don’t have commercial relations with;
  • the information/documents required for resolving the application have not been supplied;
  • the consumer does not reply within 90 days;
  • the consumer withdraws.

• Other reasons:
  • pending court proceedings;
  • forced execution procedures have already been initiated;
  • traders made several offers, but all of them were turned down by consumers (before approaching ABDRC), and traders maintain their point of view in the initial answer sent to consumers;
  • lack of grounds (claimed by the trader).

NOTE:

The statistical data shows that the number of consumers who approached ABDRC in Q3 2023 observed a slight increase (approximately 10%) compared to Q3 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 Q3 of this year are 11% better than during the same period of last year, with increases in both the number of casefiles formed; the number of direct amicable settlements between the parties (having first approached ABDRC) has remained relatively flat (with a slight evolution this year). This increase is driven including by the number of cases effectively solved and concluded with a resolution/the parties reaching an agreement (as an effect of the increased willingness of the parties to negotiate).

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 (approximately one month over the last two year), 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 nine months of 2023 are as follows:

• As many as 2,209 consumers have approached the Alternative Banking Dispute Settlement Centre (ABDRC) in the first nine 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 10% more applications;
  • The number of casefiles formed in the first nine months of this year it is growing compared to Q3 2022: 575 casefiles/Q3 2023 v 506 casefiles/Q3 2022 (an increase of 14% 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: 442 such cases/Q3 2023 v 428 such cases at the end of Q3 2022 (an increase by 3% 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 five such meetings took place in the first nine months of 2023;
  • In the first 9 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. Starting from March, ABDRC issued 21 newsletters;
  • 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 9 months of the year, 184 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 Q3 2023, the negotiation procedures involving consumers and banks facilitated by ABDRC resulted into benefits in excess of EUR 2,6 million. Thus, the total amount of the benefits obtained (in all 7 years of operational activity of the Centre) is approximately EUR 10.5 million;
  • The share of casefiles concluded with a resolution further to negotiations (in which the parties accepted the solution proposed by the conciliator) is at approximately 93% (for the applications resolve in Q3 2023).
  • Public opinion polling (opinion polls carried out by ABDRC in 2022 and 2023 with Finzoom.ro and CURS) provides an x-raying of the topics of interest and hot topics for the general public and for the banking system and underpinned the press releases and information released in different environments by ABDRC;
  • Promotion of conciliation in the courts of County of Argeș and continuation of the efforts to make more popular, and ensure media coverage for, alternative resolution through the courts of law in other counties of the country.

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.