15 September 2023
Ombudsman Diana Kovacheva notified the Governor of the Bulgarian National Bank Dimitar Radev, the Minister of Finance Asen Vasilev and the Chairman of the Association of Banks in Bulgaria Petya Dimitrova of the numerous complaints and signals from citizens who were dissatisfied with the complicated and unclear procedure for opening a free payment account with basic features.
People complain to the Ombudsman that they are unable to take advantage of the opportunity provided to them by the adopted amendments to Article 120a of the Payment Services and Payment Systems Act (PSPSA), which came into force on 1 September this year. Citizens complain that they have difficulty getting free services and no fees on a payment account with basic features, that is their income from salaries, for pensions, social benefits, scholarships. The problem is that banks impose a series of requirements and a cumbersome procedure instead of making it easier for people, and pensioners and people with disabilities are most seriously affected by this situation.
For example, banks require their customers to visit their offices repeatedly to close their existing account in which they receive remuneration – pensions, social security and social assistance benefits – and to submit an application for opening a new account with basic features, after which they should submit an official letter, according to the bank’s template, stating the amount of their remuneration.
People’s problems continue because after a few business days, they have to go to the bank’s office to get their new debit card. In addition, they must inform their employer (if they receive remuneration), the National Social Security Institute (if they receive pensions, allowances and social security benefits), social service offices (if they receive social assistance benefits), school authorities (in case of student scholarships) etc.
“It is also disconcerting that information on the application of Article 120a of the PSPSA is not available to financial service users on the banks’ websites. I consider the citizens’ dissatisfaction to be entirely justified. I find it necessary to stress that under the Payment Accounts Directive 2014/92/ЕU, the main objective of the payment account with basic features is to provide easier and more seamless access to banking services to more vulnerable consumers”, emphasizes Prof. Kovacheva.
The Ombudsman therefore urges that a relaxed procedure be introduced for the application of the statutory provision. For example, in the event of expressed wish banks should automatically convert an existing payment account into one where people receive wages, pensions, social security and social assistance benefits, scholarships for students and PhD students. She points out that citizens should be able to take advantage of this opportunity, including online, not just by visiting a bank branch in person. In addition, the Ombudsman also insists that clear and accurate information be published by banks in relation to the application of Article 120a of the PSPSA.
“I expect you to exercise your supervisory powers over commercial banks under the PSPSA. Please inform me, within the statutory period, of your opinion and the actions taken, for the benefit of the users of financial services“, writes the Ombudsman to the BNB Governor.