Written answers

Wednesday, 14 January 2015

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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130. To ask the Minister for Finance the obligations a bank has to inform customers of changes to fees or the introduction of fees. [49484/14]

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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131. To ask the Minister for Finance the obligation a bank has to customers who may move abroad in informing them of what will happen to their account. [49485/14]

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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132. To ask the Minister for Finance the reason banks can take maintenance fees from dormant accounts that are unusable by the customer; and his plans to rectify this matter. [49486/14]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 130 to 132, inclusive, together.

The Central Bank has informed me that both the European Communities (Payment Services) Regulations 2009 and the Central Bank's Consumer Protection Code 2012 contain certain requirements in relation to the information to be provided about charges to ensure that the customer is aware in advance of the amount of a charge for the provision of certain services.

The Payment Services Regulations require that payment service providers:

provide information on all charges payable by the user to the provider and, where such charges can be broken down into components, a statement of those components.

agree, between the payment service user and the payment service provider, any charges imposed. These charges shall be appropriate and in line with the payment service provider's actual costs.

All charges applicable must be provided before a user uses a payment service.

Providers must give 2 months notice to users of any proposed changes to framework contracts  and if the user is not happy with the changes proposed they can object and/or immediately terminate the contract for free.

The Central Bank's Consumer Protection Code 2012 contains a number of provisions relating to charges which regulated entities including credit institutions must comply with, except when providing payment service and/or issuing electronic money. Under the Code regulated entities must:

- make full disclosure of all relevant material information, including all charges, in a way that seeks to inform the customer.

- provide consumers with a breakdown of all charges, including third party charges prior to providing a product or service to the consumer.  Where such charges cannot be ascertained in advance, notify the consumer that such charges will be levied as part of the transaction.

- display a schedule of fees and charges in public offices, in a manner that is easily accessible to consumers. If the regulated entity has a website, its schedule of fees and charges must also be made available on the website.

- notify affected consumers of increases in charges, specifying the new charge and the old charge, or the introduction of any new charge, at least 30 days prior to the change taking effect.

- must, where charges are accumulated and applied periodically to accounts consumers, and amount to €10 or more notify the consumer at least 10 business days in advance of the deduction of the charges and give each consumer a breakdown of such charges.

In relation to an account held by a consumer who then relocates to another jurisdiction, there are numerous scenarios, including whether the relocation is temporary or permanent and whether the consumer wishes to maintain their account or close it etc. and therefore it is difficult to be definitive about a bank's obligations.  If a customer is moving abroad, he/she should clarify these matters with their bank.

With regard to the Deputy's question regarding maintenance fees and dormant accounts,  it is not entirely clear to what type of account the Deputy refers, that is, a bank account that is currently not actively being used by the customer or a dormant account within the meaning of the Dormants Accounts Act 2001.  Under the Act,  a bank account is only considered a dormant account when it is transferred to the Dormant Accounts Fund after laying dormant for 15 years. 

The NTMA informed me that it is not aware that any requests for maintenance fees from the banks have been processed by the NTMA since the establishment of the Dormant Accounts Fund. The Central Bank also informed me that it was not aware of any maintenance fees being applied to dormant accounts.

If the account is not a dormant account but has merely not been used for a period, the normal rules under the Payment Services Regulationsand Consumer Protection apply.

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