THE CENTRAL bank is encouraging Congress to pass a law which will protect the interests of financial consumers due in part to the rapid advancements arising from digitalization of transactions.
The passage of a Financial Consumer Protection Act is, in principle, very welcome.
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno says: ‘The legislative measure empowers financial regulators to take necessary actions against financial entities performing acts that may undermine consumers welfare and provides a redress mechanism’.
As a layman, the first step I would take is to abolish the BancAssurance concept. This is where banks, for reasons best known to themselves, allow insurance salesman to generate business through knowledge of the banks’ customers’ details. In my experience, the corporate culture gap between banks and insurance companies is too wide to allow the latter unfettered access to the banks’ customer data.
Banks may say, erroneously, that they do not allow this. ‘Not so’, I retort. I have in my possession a ‘Quit claim’ form from an insurance company bearing my signature but which I did not sign. With the cooperation of the concerned bank (which was not forthcoming) I could have proved this.
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Unless BSP is given more powers, which need to be specified, by the Financial Consumer Protection Act, then the Act is in danger of being toothless.
For example, in the Senate inquiry of 2016 which tried to establish what happened in the RCBC cyberheist, it appeared that RCBC was controlling the narrative. Specifically, it seemed that RCBC was placing all the blame for the cyberheist’s success on its Jupiter Street. Makati’s branch manager, Maia Deguito. I believe that RCBC was not sufficiently challenged by BSP officers or, indeed, the Senators themselves.
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On the other side of the coin, it is gratifying that Security Bank Corporation has been named the Philippines’ Best Bank by UK-based financial magazine Euromoney during its 2021 Euromoney Awards for Excellence. I can confirm that as an account holder for over ten years, I have always had the best possible relationship with Security Bank. Sanjiv Vohra, president and CEO says its goal is to be the most customer-centric bank in the Philippines. We wish him well in this worthy aspiration.
The proposed legislation is important. If a well-drafted Financial Consumer Protection Act is passed, then we believe that much is done to provide a framework in which the Philippines is taken off the ‘Gray List’ and in which we shall rejoin the countries in which the banking systems are known to be trustworthy./PN
