The Central Bank of Nigeria (CBN) has issued fresh guidelines to give effect to the disclosure and transparency principle contained in the Consumer Protection Framework (CPF) for institutions under its regulation.
The guidelines, according to an 18-page document posted on the central bank’s website yesterday, provides minimum disclosure and transparency requirements for financial institutions under the regulatory purview of the CBN to ensure they provide consumers with all material and relevant information regarding their business relationship in a clear and transparent manner.
According to the bank, the objective of the guidelines was to protect consumers against provision of inadequate, misleading or failure to disclose material and relevant information and generally guard against lack of transparency by financial institutions in their dealings with consumers.
The guidelines apply to all transactions by financial institutions licensed and regulated by the central bank and their agents, subsidiaries and associates.
These include commercial banks, merchant banks, specialised banks, microfinance banks (MFBs), Development Finance Institutions (DFIs), finance companies (FCs), Bureaux-de-Change (BDCs), Primary Mortgage Banks (PMBs), Credit Bureaux, Mobile Money Operators, Payment Service Banks, Switching Companies, Payment Solution Service Providers, Payment Terminal Service Providers, Non-bank Acquirer, Super Agents and Mobile Money Operators.
It pointed out that to promote transparency and enhance disclosure, financial institutions should ensure that contracts, offer letters, statements of account, notices and other documents (hereinafter referred to as the document” provided or made available to consumers are written in clear, legible and simple English language and in a minimum font size of 10; and state the name, contact details of the financial institution and the consumer.
Also, in terms of adverts and promotional materials, it directed financial institutions to ensure that the content of their advertisements are factual and unambiguous, expressed in clear and simple language and shall not be offensive, misleading, deceptive, injurious, or exaggerate the benefits of the products or services being advertised.
“The overall impression of advertisements shall not emphasise benefits of a product or service while de-emphasising its associated risks or important disclosure information. Financial institutions shall disclose their contact details in any advertisement or promotional material and where the advertisement is in prints, it shall be in a minimum font size of 10.
“Details of the cost of a product or services, including all fees and other charges shall be clearly disclosed. All interest rates in advertisements shall be disclosed on an annual basis and not for a shorter period. Where an advertisement refers to, or is linked to other value adding benefits, the nature and value of such benefits shall be fully disclosed.
“Advertisements shall not make references to unaudited financial statements. Financial Institutions shall not mention names of competitors or make unverifiable comparisons in their advertisements or promotional materials.
“Unsolicited advertisements through emails, text messages, voice calls and other channels sent by or on behalf of a Financial Institution shall be at no cost to the consumer and shall contain an opt-out provision for future advertisements.”