Bank of Russia receives more appeals about credit histories and less complaints against OSAGO
In 2019 Q1, the Bank of Russia received as many as 69.6 thousand complaints from financial consumers. This is 1.5 thousand (2.2%) more than in the same period in 2018. This growth was mainly caused by an increase in complaints against credit institutions, and in appeals concerning credit history bureaus. At the same time, the share of complaints against non-banks continued to decline primarily due to fewer OSAGO-related complaints.
The share of complaints against credit institutions traditionally accounted for more than a half of all complaints received by the regulator (57.2%) in January-March this year. The number of complaints received totalled 39.8 thousand or 4.6% more than in the same period of 2018. These dynamics are mainly conditioned on the almost two-fold increase in the number of deposit-related complaints; in the majority of cases, there were problems in obtaining documents or information about deposits. In turn, the factor containing growth of the total indicator for credit institutions was a 37.9% drop in the number of mortgage lending-related complaints in the context of the prevailing downward trend in the weighted average mortgage interest rate registered over several past years. A more energetic implementation of banks’ own consumer debt restructuring programmes in anticipation of a new law on mortgage holidays may also influence the drop in the number of complaints against mortgage lending. Consumer lending-related complaints make up the bulk of complaints against credit institutions (38%).
Slightly more than a third (34.3%) of all complaints received in 2019 Q1 were those against non-bank financial institutions, that is 23.9 thousand (14.6% less than in the same period of 2018). The ongoing decline observed in this segment is still linked to a considerable drop in complaints against insurance entities; in January-March 2019, they totalled 12.2 thousand (36% less year on year). The main driver of this decline was OSAGO, which accounted for the majority of complaints against insurance companies (80.8%). Over the reporting period, the number of OSAGO-related complaints dropped by 39% and came in at 9.8 thousand. Compared to 2018, e-policy-related complaints showed the biggest decline (-77.9%) caused by amendments to the Bank of Russia's regulation, including technical requirements for files and verification code, as well as the smooth and uninterrupted operation of the websites of insurers and the Russian Association of Motor Insurers. The number of complaints against the incorrect calculation of the bonus-malus coefficient (no claim bonus) contracted by 31.1%, even though this reason still prevails among other OSAGO-related complaints (47%).
In 2019 Q1, there remained the upward trend in complaints against microfinance organisations: the regulator received 6.8 complaints or by 33.1% more than in 2018 Q1. Overdue debt recovery measures remain a key problem in this segment, representing 52% of the total number of MFO-related complaints. It is of note though that the share of these complaints gradually reduces: it was 60.7% in the same period in 2018. Meanwhile growth is registered in the share of complaints against the two-, three- and fourfold excess of the amount of interest accrued under a loan agreement. This share grew by 20 pp to 22% compared with 2018 Q1.
Overall 500 complaints were received against collective investment entities in 2019 Q1, 18.9% less than in January-March 2018. The reporting period saw a change in the category that accounted for the majority of complaints. In January-March 2019, 68% complaints were linked to disagreements to migrate from the Pension Fund of the Russian Federation to various NPFs and to change one NPF for another, whereas, earlier almost half of complaints (49.5%) were categorised under the ‘Conclusion, amendment and cancellation of agreement with NPF’ heading. Applicants complained about the transfer of their money to various funds without their consent and, in some cases, about the loss of investment income as a result of a change of a pension fund.
February 2019 saw a drastic surge in credit history-related complaints: to 1.7 thousand (by a factor of 2.4 compared with January). Russians started to extensively use this service from 31 January 2019, when it became possible to send queries to the Central Catalogue of Credit Histories (CCCH) via the Single Public Services Portal. As a result, major credit history bureaus registered a sharp increase in appeals, which eventually led to an increase in the number of complaints. Overall, in 2019 Q1, 3.5 thousand complaints were received in this category. They mainly concerned the issues of receiving credit statements (45% of the total number), as well as incorrect details of the source of credit history and disagreement with information in the credit statement (33.5%).
In the course of conduct supervision measures implemented in 2019 Q1, Bank of Russia divisions conducted 25 supervisory meetings and sent 98 advisory letters as a result of comprehensive inspections and examinations of financial organisations’ internal documents and websites. Following the above, credit institutions returned roughly 12 million rubles to applicants, microfinance organisation returned over 3.2 million rubles which had been paid in excess (or overdue debt was restructured), and adjustments were introduced to 87 credit histories.