By Tšeliso Tšosane
The Upper House of Parliament, the Senate, has given the greenlight to the Financial Consumer Bill 2020 which is meant to protect financial consumers against the financial service providers.
The Bill aims to protect financial services consumers from unfair or abusive practices and prescribes action to be taken against financial service providers for unfair services. It also aims to ensure transparency in complaint handling between service providers and consumers. The bill will illustrate a guideline on how both parties should relate in provision of services.
When tabling the Bill in the Upper House, the minister of finance, Thabo Sophonea noted that Central Bank of Lesotho (CBL) will be the body responsible for regulating the services providers. It will also establish an institution mandated to resolve the disputes where consumers express their dissatisfaction against banks and insurance companies.
This institution will work on written laws that guide how it should operate. It will have power to make binding decisions to the companies.
Again, the CBL will have to conduct a campaign to notify consumers about the institution and its mandate.
The institution has to clearly identify a consumer who is drowning in debt and help the client to recuperate by extending the time to service the debt.
“The Bill is very important to consumers and there is a need to provide education and financial literacy to consumers to avoid being deceived by the banks. It is mostly important to illiterate people.
When giving thumps up to the bill, principal chief of Quthing Seeiso Nkuebe was grateful to Sophonea for tabling the bill which he said would be helpful to the financial consumers.
The passing of the billl comes after the commissioner of financial institutions the CBL last month instructed all commercial banks in Lesotho to cut charging fees in pursuant to Financial Institutions Act 2021 from April 1.
The pricing directives follow an in-depth research work and benchmarking exercise by CBL, which was followed by consultations with the commercial banks; Standard Lesotho Bank, Nedbank Lesotho, FNB Lesotho and Lesotho Post Bank.
