The implementation of the Financial Consumer Protection Act (FCPA) will improve and strengthen the public — especially financial consumers’ — trust and confidence in the financial sector, according to Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno.
“The FCPA’s enactment will bolster public trust and confidence in the financial system and stability in the financial markets,” said Diokno on Wednesday, May 18.
The FCPA, which was one of BSP’s priority legislative agenda, was signed into a new law last May 6.
Diokno reiterated that the FCPA will empower financial regulators such as the BSP, Securities and Exchange Commission, Insurance Commission and the Cooperative Development Authority to effectively exercise “rulemaking, market conduct surveillance and examination, market monitoring, as well as enforcement and adjudication powers in line with their consumer protection mandates.”
Specifically, he said the FCPA strengthens financial regulators’ stance against “disadvantageous” acts of financial service providers that are in violation of consumer welfare. “The measure also provides consumers with a redress mechanism, while ensuring equitable treatment, transparency and data privacy,” said Diokno.
The FCPA covers all financial products and services offered by any financial service provider, including those accessed and delivered through digital channels.
The new also law institutionalizes consumer protection, enables adjudication of complaints, promotes transparent and reasonable pricing, authorizes financial regulators to carry out enforcement actions, and fosters fair treatment of consumers while protecting their data. FCPA also has penal provisions for violations of the law, said the BSP.
With FCPA, the BSP will be at the forefront in its implementation primarily with the additional redress mechanism for consumer complaints. Without the FCPA, the BSP’s complaints’ resolutions process is constrained due to the central bank’s limited legal authority to adjudicate.
The BSP has received almost 10,000 consumer complaints in 2021.
Diokno said with FCPA, consumers will no longer need to go to court if their claim involves a return of money from a financial service provider. This translates to a prompt and more efficient process when consumers seek reparation in financial transactions, as warranted by financial regulators.
The FCPA will also allow regulators to go after financial service providers that are responsible for credit card fraud in online shopping. These violators will have sanctions, fines, suspension, or penalties.