Fintech Association for Consumer Empowerment Publishes the Ethical Code of Conduct

Mumbai, Maharashtra, India | 29^th December 2020: Aiming to champion fair and responsible lending practices in consumer finance, the Fintech Association for Consumer Empowerment (FACE) today published the ‘Ethical Code of Conduct (FACE CoC)’ to promote best guidelines in digital credit lending and to safeguard consumer’s rights and interests. With the Digital India initiative, driving a digitally empowered society and knowledge economy, maintaining an ethical code of conduct with larger accountability and transparency is essential for enabling robust financial inclusion in India.

FACE is a registered not-for-profit industry association formed by Fintech leaders with an intention to support the Government of India’s vision in accelerating financial inclusion and meeting the massive credit demand from consumers. The FACE ethical code of conduct (FACE CoC) is designed to prevent the rise of unwanted practices that could impact the digital lending ecosystem or adversely affect consumer confidence, regulators or other market participants.

The set of principles listed in the FACE Code of Conduct (FACE CoC) will help safeguard consumer interest and introduce transparent and fair business practices among financial institutions.

FACE ‘Ethical Code of Conduct’ (FACE CoC) has set the following standards for the members:

1. Transparency: To build high level of trust and greater understanding about products, pricing and services among customers, Fintech and NBFCs should communicate and practice absolute transparency to gain and maintain customer confidence and satisfaction.
2. Disclosure of all cost to customers: Members must unambiguously enlist all costs and fees related to the product or service offered. A detailed description of all costs such as conditional or default costs, repayment schedule with exact timelines, pre-payment fees, penalties must be explicitly provided to customer for ease of understanding.
3. Pricing and Cost of Credit: Members are required to exhibit higher level of transparency to guard customers against adverse pricing that includes any misleading or complex element in cost structure, advance disclosure of interest rates, late fees policies in accordance with the given guidelines and derive accurate assessment of the customers eligibility for a specific financial product.
4. Fair Treatment: Treating all customer equally should be at the heart of Fintech & NBFC’s business outreach. Members are encouraged to demonstrate fair and ethical practices (as published by the regulators) during the entire customer engagement lifecycle.  
5. Collection & Services: Financial institutions must build their debt collection policy to maintain the highest level of dignity and trust with regard to their customers. From providing timely and clear information on outstanding dues to providing adequate training for staff and representatives, it should be their top priority to foster confidence and develop a long lasting relationship with the customers.
6. Data Privacy: Protecting customer’s confidential data is of paramount importance in the digital economy. Large volume of sensitive data should be collected and storedas per the customer’s consent. They must refrain from misusing customer’s personal data that can potentially cause harm to the customers or with their close acquaintances.
7. Resolve customer Grievances: Provide access to fair and efficient resolution to address customer complaints that are in compliance within the defined regulatory framework. Additionally, implement a robust redressal framework that ensures customer satisfaction and implement continuous improvement process to reduce challenges, barriers and friction.

FACE is committed to work along with regulatory bodies in promoting and monitoring the highest standards of fair practices for strengthening the digital credit lending landscape in India. The association plays a pivotal role in bridging synergies between the consumers, regulatory bodies and consumer lending organizations which can help accelerate penetration of the underserved (digital) consumer finance ecosystem across India.