EBA consults on Guidelines on complaints handling by credit servicers

EBA initiated a public consultation on draft Guidelines for complaints handling by credit servicers under CSD. The proposed Guidelines align with existing Joint Committee Guidelines on complaints handling, covering aspects such as complaints management policy, function, registration, reporting, internal follow-up, provision of information, and procedures for responding to complaints. The consultation, aimed at ensuring consistent supervisory practices and high consumer protection during the CSD transposition, will run until 9 February 2024. The Guidelines apply to competent authorities and outline requirements for credit servicers in establishing transparent and effective procedures for handling borrower complaints.
The background involves the CSD of 8 December 2021, focusing on developing secondary markets for NPLs in the EU. The Directive aims to facilitate the transfer of NPLs by credit institutions to credit purchasers while safeguarding borrower rights. The EBA’s proposed Guidelines extend the application of existing Joint Committee Guidelines to credit servicers, fostering consistent complaints handling practices across the banking, investment, and insurance sectors. The consultation seeks input until 9 February 2024, with a virtual public hearing scheduled for 11 January 2024, please register for the hearing by 9 January 2024 by 16.00 CET.
The rationale behind the Guidelines includes the need for consistent supervisory practices and consumer protection during CSD Directive transposition. The EBA proposes applying Joint Committee Guidelines on complaints handling to credit servicers to ensure uniformity and avoid divergent transpositions across EU Member States. The existing JC Guidelines, applied since 2014, provide a consistent approach to complaints handling across financial sectors and contribute to consumer confidence in financial services. The EBA emphasizes the importance of aligning requirements for credit servicers with those for other financial institutions to enhance consumer protection and regulatory consistency.
The consultation discusses the dynamic expansion of the definition of ‚financial institutions’ and the need for updating ‚Competent Authorities‘ with new sectoral acts. The EBA anticipates changes to PSR in 2025 and aims to issue Final Guidelines after assessing consultation responses.
The consultation paper asks for feedback on whether there are reasons to differ in the requirements for complaints handling between credit servicers under CSD and existing JC Guidelines applicable to other financial institutions across banking, investment, and insurance sectors.