By the end of the third quarter of 2024, the number of negotiations between consumers and banks mediated by the Center for Alternative Dispute Resolution in the Banking Sector (CSALB) reached 815, the highest number in the Center’s nearly nine years of operation.

The number of requests consumers sent to CSALB is almost 30% higher than during the same period in 2023. This year, 2,050 requests have been addressed to banks, while 750 have focused on consumers’ relationships with non-banking financial institutions (NBFIs). The relationship between consumers and banks is also discussed in the 8th episode of #PodcasturileCSALB, with guests Doru Bulată and Vasile Nemeș, in a conversation moderated by Constantin Rudnițchi.

• The number of requests consumers sent to CSALB is almost 30% higher than during the same period in 2023. This year, 2,050 requests have been addressed to banks, while 750 have focused on consumers’ relationships with non-banking financial institutions (NBFIs).
• Unfortunately, none of the negotiation requests sent to NBFIs have been accepted. Only a little over 100 requests were resolved directly by NBFIs without the involvement of a conciliator, but only after the consumer submitted the request to CSALB. Most of the requests directed to NBFIs involve removing listings from the Credit Bureau.

On the other hand, banks’ interest in negotiation this year is not only focused on resolving current consumer issues but also on preventing the initiation of court proceedings.

At the end of the third quarter, the number of negotiation cases will exceed the total for all of 2023. In 95% of the concluded negotiations, the parties have reached an agreement. Only in 40 cases did the consumers, the banks, or both parties reject the solution proposed by CSALB conciliators.

Alexandru Păunescu, representative of the National Bank of Romania on the CSALB Coordination Board: “We have noticed an interesting trend in banks’ negotiations within CSALB. In 2023, there were 290 cases pending in courts that were amicably resolved with the help of conciliators. This year, there is greater interest in anticipating potentially litigious situations. As a result, the number of court-referred cases has dropped to around 100, while the number of requests where consumers approach banks through lawyers has increased. This shows that the parties are on the verge of litigation but are trying to resolve the issue amicably through CSALB. More than a third of the 2,050 requests addressed to banks since the beginning of the year have come through lawyers. This demonstrates that not only banks but also consumer lawyers are prioritizing these alternative methods to avoid lengthy and costly court processes.”

“When should I go to the bank? Firstly, when I have money. Secondly, when I need money. Banking activity is defined by attracting deposits and offering loans. Therefore, the performance of lending is tied to the performance of the clients who borrow. Clients understand banking products and services, but they also understand that taking out a loan affects their medium- and long-term security. Recent reports from the National Bank of Romania show that the non-performing loan rate in the banking system did not exceed 2.49% in July. The total population credit in July 2024 was 36.8 billion euros, while the deposit balance was almost double that, at 71.6 billion euros. Thus, we have an image of the relationship between clients and banking institutions: a relationship based on trust between the two parties, both in lending and deposit-taking activities.”

“How do we develop financial inclusion to reach deeper layers of society?”

“The relationship with the bank depends on prosperity and financial education. Financial inclusion represents the way to access services and products offered by the financial system: opening an account, making payments, saving, and lending. The level of financial inclusion in Romania is among the lowest in Europe, and to change this, we need a systemic approach. The consumer-bank relationship must rely on three important pillars: economic prosperity, financial education, and access to the financial system. People need access to a bank account, small-value credit products for short-term financial needs in emergencies, and, most importantly, financial programs for disadvantaged communities. Access to an account for transactions is the first step. A current account is the gateway to all financial products and services. It makes our daily life easier.”

“Regarding financial inclusion and its educational component, it would be welcome, perhaps even necessary, to extend the negotiation and conciliation of loan terms before they are granted, not just when consumers encounter repayment difficulties. As someone in need of credit, if I may say so, I would turn to a credit broker because I wouldn’t be able to check and compare all the banks’ offers in the market. That’s why conciliation would be helpful in this negotiation process for various banking services and products. When we’re still in the discussion phase, at the birth of the financial product, we should negotiate and anticipate the difficult situations that may arise. Thus, the contractual terms will take these situations into account and be adapted to the short-term realities and the long-term needs of the consumer. A loan is like a marriage, where problems must be resolved amicably, where overcoming disagreements happens through… understanding. People may face income reductions, job loss, or health issues. That’s why the applicant for a banking product must know what solutions are available from the start of the contract. One of these solutions is the Center for Alternative Dispute Resolution in the Banking Sector.”

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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) filling-in an online form directly on the website www.csalb.ro. Once the bank accepts to enter the conciliation/negotiation procedure, a conciliator is appointed. ABDRC works with 17 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).