The Central Bank has introduced a revised consumer protection code aimed at modernizing regulations for businesses dealing with consumers in the financial sector. The updated framework enhances protections in key areas such as digital services, mortgage switching, fraud prevention, and greenwashing.
The regulator stated that the updated code “reflects the way financial services are provided in a digital world,” acknowledging the evolving landscape of financial transactions and the associated risks.
Strengthening Consumer Safeguards
One of the major changes includes stricter requirements for firms offering digital financial services. Businesses will now be required to prioritize customer needs when designing and implementing digital offerings. Additionally, new disclosure obligations will ensure consumers are fully informed about mortgage switching options and the impact of incentives on overall loan costs.
To combat misleading marketing, companies must also ensure that consumers do not mistakenly believe they are purchasing regulated financial products when they are not. This measure aims to enhance transparency and prevent financial misrepresentation.
Addressing Fraud, Scams, and Greenwashing
Amid rising cyber threats, the revised code introduces stricter regulations on fraud prevention. Financial firms will need to take proactive steps to protect customers from scams and fraudulent activities, reflecting growing concerns over digital security.
The updated framework also addresses greenwashing—the practice of falsely marketing financial products as environmentally sustainable. Under the new rules, firms must clearly communicate the climate and sustainability features of their products to prevent misleading claims.
Implementation Timeline and Industry Consultation
Businesses have until March 2026 to comply with the new consumer protection measures. The revised code follows extensive consultation, including a public survey, stakeholder engagement, and recommendations from the Organisation for Economic Co-operation and Development (OECD). The OECD’s review last year emphasized the need for the Central Bank to increase consumer engagement when formulating policies.
A Response to Changing Financial Trends
Central Bank Governor Gabriel Makhlouf highlighted the necessity of adapting to the evolving financial landscape.
“The ways in which we as consumers buy, use, and engage with financial services are changing significantly,” Makhlouf said. “These changes reflect new preferences, provide new opportunities, and meet different needs on the part of individuals, households, and businesses. But they also create new challenges and new risks in the financial sector that we supervise and for the consumers we protect.”
The revised consumer protection code is expected to provide stronger safeguards for financial consumers while ensuring that businesses operate with greater transparency and responsibility in a rapidly changing digital world.
