Nine commercial banks have appealed at the administrative court over the charges raised by the Fair Competition and Consumer Protection Agency and lost the case.
Earlier Fair Competition and Consumer Agency held audit on 13 commercial banks in regard of consumer complaints being charged double fees at the banks. Banks are still charging the double fees as of now, hitting hard the borrowers:
- Bank loan fees supposed to be one time charge only and of one type, whereas banks tend to misinterpret and mislead its customers as separate charges, which is an illegal action.
- Above actions are seen as the conflict of interests and intended act of illegal overcharging of the customers.
- Loan fees are interpreted as unpredictable charges, which have been set too high and derogatory in view of the customers rights, breaching the equality of the contract.
Although Fair Competition and Consumer Agency has sent the notes on eliminating those violations nine commercial banks: Capitron Bank, Trade and Development Bank, Golomt Bank, Arig Bank, Khan Bank, Capital Bank, Chinggis Khaan Bank, Ulaanbaatar City Bank and Xac Bank have appealed the decision and the 20th Initial Administritative Court hearing, which took place on March 11th, ruled out in favor of Fair Competition and Consumer Agency.
Bank regulations for loans indicate the charge of fees equal to 1% of the total loan sum. Meaning, for a loan sized MNT10 billion bank will charge MNT10 million and for MNT20 billion fee will rise to MNT20 million for service charges. Fair Competition and Consumer Agency claims that service fee for 10 and 20 billion should not vary that much and fees should not base on a flat rate.
Nine commercial banks have appealed at the administrative court over the charges raised by the Fair Competition and Consumer Protection Agency and lost the case.
Earlier Fair Competition and Consumer Agency held audit on 13 commercial banks in regard of consumer complaints being charged double fees at the banks. Banks are still charging the double fees as of now, hitting hard the borrowers:
- Bank loan fees supposed to be one time charge only and of one type, whereas banks tend to misinterpret and mislead its customers as separate charges, which is an illegal action.
- Above actions are seen as the conflict of interests and intended act of illegal overcharging of the customers.
- Loan fees are interpreted as unpredictable charges, which have been set too high and derogatory in view of the customers rights, breaching the equality of the contract.
Although Fair Competition and Consumer Agency has sent the notes on eliminating those violations nine commercial banks: Capitron Bank, Trade and Development Bank, Golomt Bank, Arig Bank, Khan Bank, Capital Bank, Chinggis Khaan Bank, Ulaanbaatar City Bank and Xac Bank have appealed the decision and the 20th Initial Administritative Court hearing, which took place on March 11th, ruled out in favor of Fair Competition and Consumer Agency.
Bank regulations for loans indicate the charge of fees equal to 1% of the total loan sum. Meaning, for a loan sized MNT10 billion bank will charge MNT10 million and for MNT20 billion fee will rise to MNT20 million for service charges. Fair Competition and Consumer Agency claims that service fee for 10 and 20 billion should not vary that much and fees should not base on a flat rate.