Financial Crime World

MONGOLIA: BANKS URGED TO PROTECT CONSUMERS AS NEW DECREE TAKES EFFECT

Strengthening Financial Governance in Mongolia

The Government of Mongolia has issued a decree requiring independent members of banks’ boards of directors to prioritize consumer protection, as part of efforts to strengthen financial governance in the country.

Key Requirements of the Decree

  • Banks must establish and regularly review consumer protection policies, including measures to ensure transparency and fairness in dealings with customers.
    • Implementing “know your customer” rules
    • Providing clear product information
    • Protecting customer data

The Bank of Mongolia (BOM) will monitor compliance with these requirements during annual inspections. The Agency for Fair Competition and Consumer Rights (AFCCR) is responsible for enforcing consumer protection laws across all industries, including banking.

Challenges and Concerns

  • Critics have noted that the AFCCR’s staff is limited and lacks expertise in financial services.
  • Industry experts warn that the lack of coordination between the BOM and AFCCC could hinder efforts to protect consumers. “A strong coordination mechanism is necessary to ensure that banks are held accountable for their actions,” said [name], a financial expert.

Broader Efforts to Improve Financial Governance

The decree comes as part of a broader effort to improve financial governance in Mongolia, following a series of banking scandals in recent years. The government has also:

  • Strengthened the Banking Law
  • Introduced new regulations to curb misleading advertising in the financial sector

Consumer Expectations and Hopes

Mongolian consumers are hoping that these measures will lead to greater transparency and accountability from banks.

“As a consumer, I want to know that my bank is looking out for me,” said [name], a local resident. “These changes are a step in the right direction, but we need to see real action on the ground.”

Future Plans

The government has promised to continue monitoring the effectiveness of these measures and making adjustments as needed to ensure that consumers are protected.