Negotiations between consumers and banks are still possible despite the Coronavirus pandemics

The work of the Alternative Banking Dispute Resolution Centre (ABDRC) continues by email and phone, and the number of applications received and casefiles formed over the last couple of weeks stays close to that reported during a normal period. One of the cases resolved during this period of time regards a consumer of Cluj who obtained benefits amounting to approximately EUR 11,500 as reimbursements and written off fees.

“We welcome the initiative of the commercial banks to live up to their announced commitments to support the consumers affected by the crisis triggered by the COVID-19 virus. Also, we take this opportunity to remind both banking institutions and NBFIs, as well as consumers that ABDRC has available the necessary infrastructure to support negotiation also of other customized measures for consumers experiencing difficulties in repaying loans, or performing their contracts with banks/NBFIs. In our view, the best strategy to adopt during these difficult times is to be open to customers, negotiations, and alternative resolution avenues. During a crisis period without precedent over the last hundred of years, it’s all the more reason for conciliation to be regarded as the right approach to addressing the difficulties occurred in performance of contracts”, says Alexandru Păunescu, Chairman of ABDRC Steering Board.

More than 90% of the applications are processed online

“In the week when the pandemic was formally declared, ABDRC received 30 applications from consumers, and the banks formed 14 negotiation casefiles with them. In the week when the state of emergency was declared (16-20 March), we reported 36 applications and 10 casefiles formed. Before, during a normal week, we used to have around 40 applications and 12 casefiles formed after banks having first accepted the underlying applications. For this reason, we can say that our work has not been yet significantly hindered. This is a proof of the benefits of remote negotiation, using the IT tool that we have been providing since the summer of 2018, and the online means. In fact, ABDRC is also the ODR (Online Dispute Resolution) entity, as requested under the European Directive transposed into the Government Ordinance no. 38/2015. With the aid of email and the IT tool, we manage more than 90% of the total number of applications submitted to the Centre. On the other hand, statistics show that banks have maintained the pace of accepting the applications of consumers, which is a sign that the ARD departments of the commercial banks are still on duty and make attempts to address the problems reported by their clients to ABDRC”, says Liviu Fenoghen, Director of ABDRC.

Since the beginning of the year and until 20 March 2020, ABDRC received 504 applications, of which as many as 141 conciliation casefiles were formed. In 2019, ABDRC had received 454 applications from which 136 casefiles had been formed before 22 March. Additionally, 41 applications were amicably settled by traders having been first referred to ABDRC (by direct negotiation, which means that no conciliation casefile was formed). Last year, as many as 46 applications were amicably settled before 22 March.

EUR 11,500 further to online negotiations

A consumer of Cluj was extended a mortgage personal loan in 2008. He had his attorney approach ABDRC. The negotiations between him and the bank were facilitated by a conciliator by phone and email. Following these negotiations, he was reimbursed the file review fee, and the loan management fees collected by the banking institution, and this loan management fee was terminated for the future. Overall, the benefits for consumer amounted to EUR 11,436. Only 12 days passed since the time when the casefile was registered and until date when the resolution was rendered.

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About ABDRC: ABDRC is an entity set up under a European Directive, and intermediates, free of charge and in not more than three months, negotiations between consumers and banks or NBFIs, for contracts/agreements in progress. Consumers from any county of the country may file applications with the Alternative Banking Dispute Resolution Centre (ABDRC) via the online application available on the website the bank accepts to enter the conciliation procedure, a conciliator is appointed. ABDRC works with 19 conciliators, of the best specialists in law and with relevant experience also in the financial and banking field. Everything is settled amicably, and the understanding between the parties has the power of court judgment. More information about the work of the Centre is available by phone at 021 9414 (charged a normal rate).