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The Malta Financial Services Authority (MFSA) has issued the results of a Thematic Review assessing compliance by Financial Institutions offering payment accounts. The review focused on the quality and accuracy of Fee Information Documents (FID), Statements of Fees (SOF), and the information published on the MFSA's Payment Accounts Fees Comparison Tool.
Key Observations
The MFSA noted that Financial Institutions complied with the standardised format requirements under Commission Implementing Regulations (EU) 2018/33 and 2018/34. However, several shortcomings were identified:
- Statements of Fees: One institution failed to meet the required presentation standards, prompting the MFSA to issue corrective action instructions.
- Comparison Tool: Some institutions did not regularly update fee data, with instances of outdated products still being displayed.
- Consumer Awareness: Certain websites used misleading terminology such as “Bank,” “Banking,” or “Bank Account,” potentially leading to confusion about the institution's regulatory status.
- Website Terminology: Institutions must clearly inform clients that payment accounts are intended for transactional purposes, do not accrue interest, and are not covered by the Depositor Compensation Scheme applicable to licensed banks
Strengthening Transparency and Consumer Protection
The MFSA emphasised the importance of ensuring that consumers receive clear, accurate, and timely information before entering into agreements. This includes providing the Fee Information Document in advance, issuing annual Statements of Fees free of charge, and maintaining accurate details on the Comparison Tool.
Next Steps
The Authority expects Financial Institutions to:
- Conduct gap analyses to address discrepancies with regulatory requirements;
- Regularly review and update fee information across all consumer touchpoints; and,
- Use clear, non-misleading terminology in all client-facing communications.
The MFSA will continue its supervisory engagement to ensure that standards of transparency, compliance, and consumer protection remain central to Malta's financial services sector.
To access the 'Dear CEOs letters' issued by the MFSA, click here
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