Agency for Fair Competition and Consumer Protection Mongolia is giving two-week notification to 14 commercial banks effective from tomorrow. Previously the mentioned violations have been in the courts. However, the previous authorities of the agency have failed to appeal in the Supreme Court of Mongolia. Chairman of the agency stated that the following violations should be corrected and banks should take an action to resolve the issues in two weeks:
- The 1% fee for imposed on every loan to individuals and commercial entities violates the Competition Law;
- There are unnecessary documentations involved in the borrowing process. Also, the cost for loan process is borne by the borrower which violates the Clause 12.1.10 of the Competition Law;
- Lack of the information given to the customer regarding the interest rate calculation. Thus, confusing the customer on monthly rate and annual effective rates. This violates Clause 12.1.2 of the Competition Law – “Falsely advertising its own products and services, confusing the customer..” and Clause 7.1 of the Customer Rights Law “Failed to provide correct and sound information to the customer”;
- Commercial banks should distribute the copies of loan agreements to its branches, and without taking this measurement by forcing the agreements to the customers is violation of Clause 12.1.10 of the Competition Law – “Lawful suitability and use commercial methods to cause loss to customers”;
- Fee imposed when card users withdraw cash from bank tellers is a violation of Clause 12.1.10 of the Competition Law – “Lawful suitability and use commercial methods to cause loss to customers”;
- Require PIN code when make purchase at POS (Point of sales terminal) machines such us supermarkets and service centers.