Organization “Young Barristers” from the licensed bank institutions in Georgia, due to the outbreak of Covid 19, is demanding the proactive publication of the results of a three-month concession period for the individuals and legal entities and states out, that it is important to have the information available for the society and interested parties about how many individuals and legal entities have decided to take advantage of the favorable conditions by the financial institutions and what is the statistics for particular each licensed banking institution.
According to “Young Barristers’” lawyer, Tamar Tsikhishvili, whether the obligations arising from the loan agreements will be delayed or not is significantly depended on the social indicators of how many individuals and legal entities will express their will to agree on the terms offered by the commercial banks. Of course, there is still a state of emergency in the country and the various sectors are still in the process of returning to the work regime. Therefore, the issue should be considered based on the capabilities of the loan payer and the economic indicators presented by the work process. In that way, the commercial banks are forced to make future decisions – to justify or reject the extension of the concessions period, based on the solid arguments, which is impossible without statistics.
Also, it is important to pay attention to the matter, if the consumer rights are violated by the favorable conditions presented by the financial institutions. Due to the state of emergency in the country, the loan payers have been offered by the financial institutions the specific terms of conditions. First of all, the purpose of doing this is to temporary exempt the citizens from concrete financial obligations in the period of financial crisis. This is reflected by the 3 month rescheduling of the financial obligations.
Based on the information published by the financial institutions, all the individuals are automatically involved in the grace period, expect the particular cases. Due to the fact that each individual has its own different type of service, the liability and responsibility of them is also different. Therefore, the financial institution itself determines the category. And about the content of the mentioned conditions, individually, based on the field of activity, but in the most cases, is applied to the following services: consumer loan, mortgage loan, installment loan, pawn loan, auto loan (in some cases), overdraft and others.
Based on Tamar Tsikhishvili’s explanation, in most cases, the loan term increases in proportion to the grace period, and the deferred amount and accrued percentage will be distributed over the extended period of the loan, So that after the grace period, according to the schedule, the amount to be paid will be closer to the amount before the grace period. As it turns out, in the case of individual financial institutions, consumers should expect for some small, minor misunderstanding in the amount of payments after the grace period, and some of the financial institutions even take into consideration the interests of the client and determine that after the end of that particular period, customers won’t have to pay an increased amount of money. Thus, in the future, the threat of an increase in contributions in the payment obligation won’t be eliminated, and this will harm the rights of consumers.
The special attention is paid to the matter of the voluntary involvement in the favorable conditions. Of course, any kind of concessions, which are aimed to the well-being of citizens, should be positively evaluated. But, the problem is the fact, whether the particular customer wants to accept that above mentioned conditions, despite having the event of the state of emergency. As a rule, customers are automatically involved in the favorable conditions, however, they still have the opportunity to refuse to do so by addressing the bank. Based on the existing means of communication, it would be better to involve the customers not automatically, but after they reference. Especially, due to the restriction of movement, it wasn’t possible for the customers to address the bank. And the telephone communication sometimes wasn’t enough to solve the problem. That news, in the respect of technology, isn’t properly well-founded, which, in the ends, forces the customers to pay more contributions, and to extend the term of fulfillment of the obligation.
Therefore, the favorable terms of conditions offered by the financial institutions haven’t been fully focused on consumer rights. In case when we talk about changing the substantive terms of the existing bilateral agreement, this, of course, should have been done again based on the agreement, involving both sides. Reality shows otherwise, due to the fact that the bank unilaterally expresses its will, because of the limited conditions (which is reflected in the means of communications or restriction of the movement) it considers the user’s conclusive actions as a consent. This, of course, is unacceptable and violates the consumers’ rights. The proper response on the problem in important, in order to prevent the possible willfulness from the financial institutions.
