Financial education of citizens:
When to contact the ombudsman for the banking system?
The protection of users of financial services is the subject of interest not only domestically, but also the widest international expert public, and the importance of this issue was additionally emphasized after the outbreak of the world financial crisis and the materialization of risks related to financial mediation, and not only from the point of view of the indisputable need to protect users, but also from the aspect of preserving the stability of the entire financial sector.
With the adoption of the Law on Amendments to the Law on the Banking Agency of the Republika Srpska in 2011, the regulatory and supervisory function of the Banking Agency of the Republika Srpska was modernized and expanded in the area of protecting users of financial services, and the Institute of Ombudsman for the Banking System of the Republika Srpska was established, with the aim peaceful settlement of disputes between users and providers of financial services.
Prescribing the protection of consumers – users of financial services, the Law on Banks of Republika Srpska was harmonized with the legal acquis of the European Union, and amendments were made to the Law on Microcredit Organizations and the Law on Leasing, in order to systematically and comprehensively regulate this issue.
Protection mechanisms and instruments should provide three conditions:
- user information – that they have at their disposal comprehensive, timely and comprehensible information about financial services and potential risks that ensure making an adequate and well-founded decision,
- equitable and correct (fair) treatment from banks – which implies responsible loan approval and financial enlightenment of users, taking into account the problem of information asymmetry, and
- the right to efficient and inexpensive mechanisms for the peaceful resolution of disputes, as an alternative to court proceedings.
By fulfilling these conditions, the relations between users and banks are raised to a higher level of mutual trust, and interbank competition becomes more dynamic in terms of respecting users’ demands for greater transparency in bank operations.