The Reserve Bank of Malawi (RBM) and Competition and Fair Trading Commission (CFTC) have warned financial institutions against non-disclosure of information to consumers.
RBM and CFTC signed a memorandum of understanding (MoU) in 2016 which looks at consumer protection, and so far, the two institutions have been flooded with consumer complaints on non-disclosure of information, among other complaints.
The two institutions have since organised a series of financial sector surgeries on consumer protection aimed at sensitising financial service providers to ensure that they allow consumers to enjoy their rights to sustain the demand for financial services.
Speaking at one of meetings in Mzuzu on Wednesday, CFTC director of consumer welfare and education Lewis Kulisewa said experience on the market has shown that most financial service providers are not disclosing more detailed information to consumers about their products and services.
“We have made it a point to hold these surgeries to sensitise the service providers on what they need to do to ensure that they do not flout the laws because from the perspective of CFTC, we are enforcing the laws robustly and making sure that appropriate penalties are meted out to any financial service institution found violating the law,” he said.
Kulisewa said in 2016/17 financial year, CFTC received 176 consumer complaints while from July this year to date, they have received 45 complaints of which 15 percent are to do with the financial sector.
RBM chief examiner for financial consumer protection and financial literacy Madalitso Chamba said through the central bank’s monitoring exercise, they have established that there is knowledge gap between financial consumers and service providers.
“Some consumers sign blank contracts which means that the consumer does not know the terms and conditions of that particular contract which creates gaps,” she said, adding that RBM is urging all financial services providers to provide customers with adequate and accurate information. n