CONTRACTUAL BALANCE AS A DUTY TO CONSUMERS BY FINANCIAL INSTITUTIONS IN CAMEROON - CONSUMER PROTECTION IN BANKING PRODUCTS AND SERVICES IN CAMEROON
Consumer protection in the sphere of banking products and services in Cameroon comprises the body of laws, regulations, and institutional rules established to guarantee fair treatment, transparency, and safety for individuals availing themselves of financial services. It serves to protect consumers against fraud, predatory lending, concealed charges, and unfair commercial practices, whilst ensuring the provision of clear and accurate information pertaining to risks and costs, and the availability of effective mechanisms for the resolution of complaints.
Key Aspects of Consumer Protection in Banking in Cameroon
- Transparency & Disclosure: Banks in Cameroon are required to provide clear and comprehensible information regarding the terms and conditions, interest rates, and fees applicable to their products and services, including by way of fee information documents or key facts statements, as appropriate.
- Fair Treatment & Suitability: Financial institutions in Cameroon are required to conduct themselves with honesty and professionalism in all dealings with consumers, ensuring that any products sold are appropriate and suitable for the individual needs of the consumer concerned.
- Data Security & Privacy: Consumer protection mechanisms include safeguards designed to ensure the confidentiality of customers' personal and financial information.
- Redress & Complaint Handling: Consumers have the right to access dispute resolution mechanisms that are efficient, affordable, and independent, ensuring they can seek and obtain fair compensation where appropriate.
- Responsible Lending & Anti-Usury: Applicable regulations in Cameroon prohibit unethical debt collection practices and impose an obligation on lenders to conduct a thorough assessment of a borrower's capacity to repay prior to extending credit, thereby affording protection against predatory lending practices.
- Protection of Funds: Measures such as deposit insurance protect consumer deposits.
CONTRACT BALANCE OBLIGATION OF FINANCIAL INSTITUTIONS IN CAMEROON
Consumer consent is not presumed. Under penalty of nullity, it must be expressly obtained by the institution prior to any commitment or modification of the terms of an agreement initiated by the institution, and the burden of proof thereof, if necessary, will be to demonstrate such consent.
Any agreement between a regulated institution and a consumer must provide the latter with the option of requesting a cooling-off period of at least three days from the date of receipt of the preliminary offer. This cooling-off period is a period before the expiry of which the consumer may not express their acceptance.
In the case of bank solicitation, the consumer has a period of fourteen full calendar days to exercise their right of withdrawal, without having to provide any justification or incur any penalties. The withdrawal period begins either on the day the contract is concluded or on the day the consumer receives the contractual terms and information, if the latter date is later than the date the contract was concluded.
When the consumer exercises their right of withdrawal, they are only required to pay the price corresponding to the use of the product or banking service actually provided between the date the contract was concluded and the date the right of withdrawal was exercised, excluding any penalty.
The unilateral modification, by the contracting authority, of the terms of an agreement in progress is prohibited and therefore null and void.
Any modification to the terms of an existing agreement, contemplated by a regulated institution, must be proposed by the institution to the consumer in writing, with proof of receipt, in an official language of the State, in a clear and easily understandable form, no later than one month before the scheduled effective date.
The consumer is deemed to have accepted the modification if they have not notified the regulated institution of their refusal before the proposed effective date of the modification.
A consumer who does not approve the modification has the right to terminate the contract free of charge and with effect at any time up to the date on which the modification would have been implemented.
Under a credit agreement, the consumer may repay the credit amount at any time, subject to the conditions stipulated in the agreement.
The credit agreement must specify the terms and conditions for early repayment and the order in which early repayments must be made. In all cases, early repayment must not result in an increase in the consumer's financial burden beyond accrued interest and fees.
In agreements between regulated entities and consumers, the following clauses are considered abusive and therefore prohibited:
- Exempt, exclude, reduce, or limit the regulated entity's liability for defects, deficiencies, or inadequacies of any kind in the technology, goods, or services provided;
- Imply the loss of rights and freedoms guaranteed to the consumer by applicable law, or limit their exercise;
- Reserve for the regulated entity the right to unilaterally modify the characteristics of the product to be delivered or the service to be provided;
- Create unfair, unreasonable, inequitable, or punitive contractual terms or conditions, or make the consumer liable for defects, deficiencies, or inadequacies that are not immediately apparent.
Unfair terms are deemed unwritten. Consequently, the contract is only enforceable insofar as it can continue to function without said terms.
The unfairness of a term is assessed by considering, at the time of the conclusion of the agreement, all the circumstances surrounding its conclusion, as well as all the other terms of the agreement. It is also assessed in light of the terms contained in another agreement when the conclusion or performance of these two agreements is legally interdependent.
The account opening agreement or the subscription agreement for a banking product or service concluded with each consumer stipulates that the institution is responsible to the consumer for the proper completion of transactions carried out by an intermediary, distributor, or sub-distributor.
It is prohibited for regulated institutions to make the purchase of one banking product or service conditional upon the simultaneous purchase of another banking product or service for consumers, except when these products or services cannot be purchased individually or when they are inseparable.
When certain banking products or services referred to in Article 5 of this regulation are included in a package with other types of services, the related contracts must list these products or services by name and clearly and unambiguously state in the contract that these products or services are free of charge.