Business

New disclosures for credit institutes

By RACHNA LAL The Reserve Bank of Fiji has issued several new disclosure requirements for licensed credit institutions. The key initiatives will now be on standardisation and disclosing details on
04 Oct 2012 09:01

By RACHNA LAL

The Reserve Bank of Fiji has issued several new disclosure requirements for licensed credit institutions.
The key initiatives will now be on standardisation and disclosing details on fees, charges and interest rates to the public.
The central bank said the standardisation was aimed at ensuring greater transparency and comparability of fees, charges and interest rates across the different institutions.
“The level of details required is aimed at assuring customers of the likely total cost of borrowings or net returns they will receive from deposits before a decision is made,” it said in a statement.
Reserve Bank Governor, Barry Whiteside, said this completed the first phase of the central bank’s work on reforming fees and charges charged by licensed credit institutions in the country.
He said the second phase, which was in progress, was the review of all current fees and charges of the credit institutions.
“The policy statement is the culmination of three years of work towards ensuring customers get sufficient information before deciding to take a loan or invest in a time deposit, during the term of the loan or deposit and when it is paid off,” he said.
“The requirements were carefully chosen to provide customers with relevant information to enable them to make sound decisions after comparing carefully the features and costs of products available.”
The policy is applicable to Home Finance Company Limited, Merchant Finance Company Limitedand Credit Corporation (Fiji) Limited.
It is a review of the July 2002 Disclosure of Fees and Charges Policy which credit institutions have implemented for over 10 years.
The revised policy requirements are effective from October 1, 2012, while provisions requiring non-system changes, such as updating and printing of revised fees and charges brochures and updating letters of offer, would become effective from January 1, 2013.
Credit institutions have also been given time to implement other long-term changes.
Mr Whiteside has urged all customers to make good use of the information provided by banks and credit institutions to ensure they understood what they were buying and how much they would be paying for a product or a service.
A similar policy guideline was issued to licensed commercial banks in September 2011.




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