The total number of casefiles formed at the end of Q1 2024 reached 241, all involving banks (compared to the first three months of 2023, when 204 casefiles were formed, which means an increase of 18% in the current year). 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 188, compared to the similar period of the previous year, when only 149 resolutions were reported (a 26% increase this year).

The number of applications recorded in the first three months of the year (943 applications) shows an increase in the current year of approximately 7% compared to Q1 2023 (884 applications). The gradually downward trend of inflation, as well as the continued high ROBOR and IRCC indices, on the basis of which the monthly instalments to be paid on variable-rate loans are calculated, have been the context in which some consumers have continued to experience actual payment difficulties, and these justified circumstances have meant that solutions to rebalance contractual obligations have had to be found (requests being sent directly to creditors or made through the ABDRC).

Of the total number of applications received by the end of the first quarter of 2024, 645 concerned different issues in relations with banks, whereas 298 concerned different issues in relations with NBFIs.

Thus, the share of applications to NBFIs fell slightly below last year’s reference period: from 35% of total/Q1 2023 down to 32% of total/Q1 2024.

Moreover, the share of applications intended at banks is has had a slight increase during the two compared periods: 65% of the total/at the end of Q1 2023, and 68% of the total/Q1 2024.

In this statistical slot, we need to highlight also that, in the first three 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 Q1 2024, we see 344 applications for deregistration from the CR (221 intended at banks + 113 intended at NBFIs), while the number of this type of application observed at the end of Q1 2023 was 355. 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 Q1 2024 reached 241, all involving banks (compared to the first three months of 2023, when 204 casefiles were formed, which means an increase of 18% in the current year). Of the casefiles formed this year and settled until the end of the reference period, 188 concluded with a resolution (the parties accepted the solution proposed by the conciliator), and additional 46 casefiles are still being processed. In 3 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 188, compared to the similar period of the previous year, when only 149 resolutions were reported (a 26% increase this year).

Furthermore, before the end of the first quarter of 2024, 95 applications were settled amicably by traders after the respective cases having been referred to ABDRC (traders negotiated directly with consumers), broken down as follows: 34 applications settled amicably with banks, and 61 applications settled amicably with NBFIs.

In the end of the Q1 of this year, we counted approximately 650 enquiries made by phone, and 122 persons/consumers accessed the chat function on the website of ABDRC.

The status of claims against merchants is as follows:

Banks:

• 645 compliant applications;
• 148 non-compliant applications;
• 395 requests for miscellaneous information.

Classification of the 645 compliant applications:

• 241 casefiles formed at the end of Q1 2024 (23 casefiles are formed in 2024 from applications received at the end of 2023);
• 187 in screening phase – documents are being reviewed;
• 34 applications were settled amicably by the parties, but this after the consumer having first referred the case to ABDRC;
• 190 cases were closed;
• 16 applications were joined.

Classification of the 241 casefiles in the procedure with proposed solution/conciliation:

• 188 resolutions rendered – the parties reached an agreement;
• 46 cases in the processing phase;
• 3 reports – the parties failed to reach an agreement;
• 4 casefile in which one of the parties withdrew.

Means of filing compliant applications:

• 283 were submitted via the app (website);
• 351 were sent via e-mail;
• 4 were mailed;
• 7 were brought to, and registered by consumers with the office of ABDRC.

NBFIs:

• 298 compliant applications.

Classification of the 298 compliant applications:

• 0 cases formed at the end of Q1 2024;
• 62 applications in the screening phase;
• 61 applications were settled amicably between the NBFI and the consumers concerned, after the consumer having first approached ABDRC;
• 175 were closed – rejected by the NBFIs.

Means of submitting compliant applications:

• 282 were submitted via the app (website);
• 14 were filed by e-mail;
• 2 were mailed;
• 0 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, statements of account, etc.);
• Refunds of garnished amounts;
• Mortgage deregistration;
• 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:
  • 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 Q1 2024 observed a slight increase (approximately 7%) compared to Q1 2023. The number of cases filed is increasing (204/Q1/2023 and 241/Q1/2024) and the number of direct settlements between parties is decreasing (148/Q1/2023 and 95/Q1/2024). In terms of 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), we have recorded a significant increase (149/Q1 2023 and 188/Q1 2024).

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 three months of the year 2024 are as follows:

• 943 consumers have approached the Alternative Banking Dispute Settlement Centre (ABDRC) in the first three months of this year to find amicable solutions in their relations with banks and NBFIs. Compared to the similar period of 2023, consumers filed approximately 7% more applications;
  • The number of casefiles formed in the first three months of this year it is growing compared to Q1 2023: 241 casefiles/Q1 2024 v 204 casefiles/Q1 2023 (an increase of 18% 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: 95 such cases/Q1 2024 v 148 such cases at the end of Q1 2023;
  • The csalb.ro website offers a section dedicated to financial education, and ABDRC’s communication with consumers of financial services focused in the past years on this particular matter, which has become highly important in the context of these unpredictable economic and social developments;
  • In the same context of financial education, ABDRC started the 4th season of ABDRC Podcasts in March. This year’s speakers include representatives from top management of commercial banks, conciliators and legal specialists and specialised journalists from the financial-banking sphere. The materials are promoted both on ABDRC’s own channels (site, Facebook, LinkedIn, YouTube, Instagram, TikTok), and through media partners (TV channels, radio, online media, local media, blogposts);
  • In the first 3 months, ABDRC produced tens of consumer financial awareness and education videos and materials.
  • 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, ABDRC 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 3 months of the year, 57 court cases were closed because the underlying disputes had been amicably settled via ABDRC, (compared to the 290 such cases reported for the entire 2023);
  • In the end of Q1 2024, the negotiation procedures involving consumers and banks facilitated by ABDRC resulted into benefits in excess of EUR 0,6 million. Thus, the total amount of the benefits obtained (in all 8 years of operational activity of the Centre) exceeded EUR 11 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 98% (for the applications resolve in Q1 2024).

We will continue 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.