Response to consultation on Technical Standards on standardised terminology and disclosure documents under the PAD
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Applying a broad approach ensures that the definition of “services” consists of the core services commonly used by a majority of member states. A broad approach is less time consuming and creates a transparent system that enables consumers to attain better understanding of the services provided. Additionally, comparability is better achieved when the services are limited to the core elements of a service.
Finance Norway advises against applying a narrow approach. A narrow approach requires specific and detailed descriptions of each service. Finance Norway believes that a narrow approach will not achieve the aims of the directive. Certain services would not be covered by the scope of the definition and thereby excluded from the directive. Furthermore, Finance Norway believes the implementation process using a narrow approach will eventually stagnate, and potentially exhaust banks and consumers.
Specifying every type of cash withdrawals or credit transfers can cause confusion or misunderstanding on certain terminology for consumers. Finance Norway agrees that defining all types of cash withdrawals as one type of service is beneficial for consumers and banks.
Additionally, the services ensure that the broadest possible number of common services is accomplished, and the services’ terminology is harmonised at an adequate level and the core elements in the services is reasonably addressed. These services are easy to understand for consumers. This helps consumers to compare payment account fees and offers on a cross-border basis.
EBAs observation regarding the differences on how member states refer to customers and PSPs in their definitions coincides with Finance Norway’s view.
The final list of standardized terms and conditions is suitable to achieve the aims of the directive. The definitions promote clarity and simplicity and reflect key features without unnecessary detail.
Our concerns are in regards to requirements for implementing the FID and SOF. In general, these should encourage clarity, transparency and especially focus on consumer friendliness. Norwegian banks already have sufficient and satisfactory structures similar to those required by the FID and SOF within Norway. Full implementation of the FID and SOF will require new lines for extracting and the aggregation of data, as well as the composition of data. Norwegian banks have raised concerns regarding the lack of flexibility on applying the use of these. Concerns relate to the major systems development project that has to be initiated if “full” implementation is considered necessary. Therefore, without some flexibility this project will generate high costs without giving consumers added value.
It is Finance Norway’s understanding that in most member states similar systems are not sufficient or existent, making full implementation necessary. In Norway however, systems that are transparent and comparative are already implemented nationally by banks. The payment services offered are presented in a suitable manner and price lists are available online for everyone to access. Additionally, the standardized format for information on accumulated fees for the use of payment services will warrant a massive development and restructuring for banks that already have a sufficient product set in place for this purpose.
Finance Norway would highly appreciate that these factors would be taken into consideration and thereby add flexibility where sufficient systems are available.
Aside from the concerns stated above, Finance Norway finds most of EBA’s view to be reasonable. Some additional comments are listed in the following questions and answers.
The FID template chosen is suitable to achieve the aims of the directive. The A4 format is widely-acknowledged. Finance Norway suggests that font size 12 is used in replacement of 11 for the main text.
Finance Norway has to emphasise that information regarding additional fees for any service exceeding the covered quantity should be stated explicitly. This ensures that customers are aware whenever offered services has extra charges. This also enables customers to understand fees and make informed decisions as to which payment account is most suitable for their needs. Finance Norway suggests using bold or cursive headings or adding an “NB.” This gives easier access to important information and allows customers to - without difficulty - compare offers from different providers and thereby select whichever option suits their needs. Situations where customers make uninformed choices that are promoted as inexpensive, should be avoided.
Art.12.4 instructs payment service providers to display in the sub-column the “Number of times the fee was charged, (…) right aligned.” Finance Norway suggests that this is put in bold.
Art. 12.5 instructs payment service providers to display in the sub-column “total” the resulting amount of fees paid (…) in bold. Finance Norway are in favour of putting this in bold, but suggests also using cursive text to further distinguish the total amount of fees to other fees. Customers mostly avoid lengthy text and details, and therefore clear numbers are favourable to lengthy instructions.
Question 1: Do you agree with the EBA’s decision to take a broad approach to defining ‘service’? Please explain your reasoning.
Finance Norway agrees with EBA’s decision to take a broad approach to defining “service.” Some additional comments are listed below.Applying a broad approach ensures that the definition of “services” consists of the core services commonly used by a majority of member states. A broad approach is less time consuming and creates a transparent system that enables consumers to attain better understanding of the services provided. Additionally, comparability is better achieved when the services are limited to the core elements of a service.
Finance Norway advises against applying a narrow approach. A narrow approach requires specific and detailed descriptions of each service. Finance Norway believes that a narrow approach will not achieve the aims of the directive. Certain services would not be covered by the scope of the definition and thereby excluded from the directive. Furthermore, Finance Norway believes the implementation process using a narrow approach will eventually stagnate, and potentially exhaust banks and consumers.
Specifying every type of cash withdrawals or credit transfers can cause confusion or misunderstanding on certain terminology for consumers. Finance Norway agrees that defining all types of cash withdrawals as one type of service is beneficial for consumers and banks.
Question 2: Do you consider the services that the EBA has selected for standardised terms and definitions to be suitable to achieve the aims of the Directive? Please explain your reasoning.
Finance Norway considers the identified “services” to be suitable to achieve the aims of the Directive in light of the presented statistics and the frequent use of these services.Additionally, the services ensure that the broadest possible number of common services is accomplished, and the services’ terminology is harmonised at an adequate level and the core elements in the services is reasonably addressed. These services are easy to understand for consumers. This helps consumers to compare payment account fees and offers on a cross-border basis.
Question 3: Do you consider the drafting decisions taken by the EBA for the standardised terms and definitions, and the resultant provisions in Recitals of the draft RTS, to be suitable for achieving the aims of the Directive of enhancing transparency and comparability? Please explain your reasoning.
Finance Norway supports the reasoning that the language used for standardised terminology in drafting the terms and definitions should promote accessibility for consumers. The standardized terms and conditions should avoid difficult terminology, and instead apply a clear, simple and consumers-oriented language.EBAs observation regarding the differences on how member states refer to customers and PSPs in their definitions coincides with Finance Norway’s view.
The final list of standardized terms and conditions is suitable to achieve the aims of the directive. The definitions promote clarity and simplicity and reflect key features without unnecessary detail.
Question 4: Do you consider the terms and definitions proposed by the EBA in the Annexes to the draft RTS, and the resultant provisions in the Recitals of the draft RTS, to be adequate for achieving the aims of the Directive of enhancing transparency and comparability? If not, please provide alternative terms and definitions and their underlying rationale.
Finance Norway has no objections.Question 5: Do you consider the FID template that is being proposed in the draft ITS and its Annex to be suitable to achieve the aims of the Directive? Please explain your reasoning.
As a general remark to the FID and SOF, Norwegian banks find EBAs reasoning to mostly achieve the aims of the directive. However, a flexible approach with less focus on being formalistic and normative is favourable when sufficient systems are already implemented nationally.Our concerns are in regards to requirements for implementing the FID and SOF. In general, these should encourage clarity, transparency and especially focus on consumer friendliness. Norwegian banks already have sufficient and satisfactory structures similar to those required by the FID and SOF within Norway. Full implementation of the FID and SOF will require new lines for extracting and the aggregation of data, as well as the composition of data. Norwegian banks have raised concerns regarding the lack of flexibility on applying the use of these. Concerns relate to the major systems development project that has to be initiated if “full” implementation is considered necessary. Therefore, without some flexibility this project will generate high costs without giving consumers added value.
It is Finance Norway’s understanding that in most member states similar systems are not sufficient or existent, making full implementation necessary. In Norway however, systems that are transparent and comparative are already implemented nationally by banks. The payment services offered are presented in a suitable manner and price lists are available online for everyone to access. Additionally, the standardized format for information on accumulated fees for the use of payment services will warrant a massive development and restructuring for banks that already have a sufficient product set in place for this purpose.
Finance Norway would highly appreciate that these factors would be taken into consideration and thereby add flexibility where sufficient systems are available.
Aside from the concerns stated above, Finance Norway finds most of EBA’s view to be reasonable. Some additional comments are listed in the following questions and answers.
The FID template chosen is suitable to achieve the aims of the directive. The A4 format is widely-acknowledged. Finance Norway suggests that font size 12 is used in replacement of 11 for the main text.
Question 6: Do you consider the common symbol in the FID template that is being proposed in the draft ITS and its Annex suitable to achieve the aims of the Directive? Please explain your reasoning.
In light of the description provided, the common symbol in the FID template is suitable to achieve the aims of the Directive and sufficiently represent the purpose of the document. In Finance Norway’s view, EBA will face challenges if it attempts to create a symbol that reflects everyone’s perception of its meaning.Question 7: Do you consider the proposed instructions for the completion of the FID template contained in Articles 2 to 11 of the draft ITS, to be suitable to achieve the aims of the Directive? Please explain your reasoning.
The proposed instructions are sufficiently detailed and formulated fittingly, ensuring that it is easier for banks to abide by.Finance Norway has to emphasise that information regarding additional fees for any service exceeding the covered quantity should be stated explicitly. This ensures that customers are aware whenever offered services has extra charges. This also enables customers to understand fees and make informed decisions as to which payment account is most suitable for their needs. Finance Norway suggests using bold or cursive headings or adding an “NB.” This gives easier access to important information and allows customers to - without difficulty - compare offers from different providers and thereby select whichever option suits their needs. Situations where customers make uninformed choices that are promoted as inexpensive, should be avoided.
Question 8: Do you consider the proposed instructions for the completion of the FID template contained in Articles 2 to 11 of the draft ITS, to be clear and easy to follow? Please explain your reasoning.
Finance Norway finds the proposed instructions to be clear and easy to follow. Finance Norway’s main concern relates to the longevity of the instructions. Long and detailed instructions however, could potentially help avoid misunderstanding and misinterpretation. Nevertheless, considering uniform instructions are intended to enhance the internal market of payment accounts, and guarantee greater access for EU consumer to bank account, the proposed instructions are satisfactory.Question 9: Do you consider the SoF template that is being proposed in draft ITS and its Annex to be suitable to achieve the aims of the Directive? Please explain your reasoning.
The SOF template is suitable for achieving the aims of the Directive. The template is clear and understandable, and thereby easy to follow. However, our main concern relates to extra fees not being included in the package. Finance Norway suggests writing these in cursive, highlighted or in bold. This ensures customers make an informed choice, and reduce potential customer complaints regarding misinformation.Question 10: Do you consider the common symbol that is being proposed in the draft ITS and its Annex to be suitable to achieve the aims of the Directive? Please explain your reasoning.
Finance Norway finds, in light of the feedback from respondents after the test, that any initial concerns regarding the symbols clarity were answered. With a strong part of the respondents agreeing that the symbol made the document distinguishable to other documentation, we find the common symbol to be suitable to achieve the aims of the Directive.Question 11: Do you consider the proposed instructions for payment services providers on how to complete the SoF template contained in Articles 2 to 16 of the draft ITS, to be suitable to achieve the aims of the Directive? Please explain your reasoning.
Finance Norway mainly agrees that the proposed instructions for payment service providers on how to complete the SoF template contained in Article 2 to 16 is suitable to achieve the aims of the Directive. However, we would like to add some additional comments:Art.12.4 instructs payment service providers to display in the sub-column the “Number of times the fee was charged, (…) right aligned.” Finance Norway suggests that this is put in bold.
Art. 12.5 instructs payment service providers to display in the sub-column “total” the resulting amount of fees paid (…) in bold. Finance Norway are in favour of putting this in bold, but suggests also using cursive text to further distinguish the total amount of fees to other fees. Customers mostly avoid lengthy text and details, and therefore clear numbers are favourable to lengthy instructions.