CBUAE Consumer Protection in Collections and Debt Counselling
Course Description:
This one-day intensive course focuses on the CBUAE Consumer Protection Regulation (Circular No. 8 – 2020) and the accompanying Consumer Protection Standards with a specific emphasis on the articles and clauses relevant to debt collection practices and the provision of debt counselling services. The training will cover the regulatory requirements for fair treatment of consumers in financial difficulty, ethical debt collection, procedures for revised payment arrangements, and the role of debt counselling in supporting consumers. Participants will gain a comprehensive understanding of their obligations under the Central Bank’s guidelines to ensure compliance and positive consumer outcomes.
Course Objectives:
- The objective of this training is to introduce participants to the following main topics: The principles of Fair Treatment of Consumersas they relate to collections and debt counselling
- Regulatory requirements for establishing clear standards and procedures that prohibit undue and coercive pressure on consumers during debt collection
- The process for identifying and assisting borrowers/financees facing difficulties in servicing their debt.
- Guidelines for offering and documenting revised repayment/payment arrangementswith consumers in financial distress
- Requirements for providing clear disclosure and explanation of revised repayment arrangements
- Making information available to consumers regarding debt management, including contact information and self-help tools
- The importance of having written policies and procedures for managing debt collection.
- The requirements for sending updated disclosure notices of arrearsto consumers
- The role of Credit Counsellorsin assisting borrowers/financees in managing their indebtedness
- Relevant aspects of Complaint Management and Complaint Resolutionrelated to collection activities and debt counselling
- The need to consider the inclusion of vulnerable groupsin debt collection and counselling processes
- Training requirements for staff in identifying and handling complaints
- The necessity for staff to be qualified and adequately trained to handle consumers facing financial difficulties with respect and empathy
Course Outline:
Foundations of Consumer Protection in Collections and Debt Counselling
- Overview of the CBUAE Consumer Protection Framework and its relevance to collections and debt counselling
- Key principles of Fair Treatment of Consumers (Article 5.2)and their specific application in collections
- Understanding the Licensed Financial Institution’s Code of Fair Treatment of Consumers
- The ethical obligations of staff in Collections and Debt Counselling Departments
Responsible Debt Collection Practices (Morning Session)
- Regulatory requirements for written policies and procedures for debt collection (Article 5.2.5)
- Prohibition of undue and coercive pressureon consumers during debt collection
- Guidelines for communicating with consumers in arrears, including updated disclosure notices
- Restrictions on requiring consumers to provide information regarding decisions to transfer financial activities
- Importance of discussing financial difficulties with consumers before proceeding with collection efforts
Revised Payment Arrangements and Debt Counselling
- Identifying borrowers/financees facing difficulties in servicing their debt (Article 5.1.2.10)
- The role of Credit Counsellorsin providing assistance
- Procedures for reaching an agreement on revised repayment/payment arrangements(Article 5.2.4)
- Requirements for providing clear written disclosure and explanation of revised arrangements.
- Making debt management information available to consumers(Article 5.2.4.6).
- Internal procedures for reviewing requests for revised payment arrangements.
Complaint Handling and Vulnerable Consumers (Afternoon Session)
- Complaint Management and Complaint Resolution (Article 8)in the context of collections and debt counselling
- Training staff on identification and handling of complaints
- Considering the inclusion of vulnerable groups (Article 10)in collections and debt counselling
- The need for sensitivity trainingfor staff interacting with vulnerable consumers
- Ensuring accessibility of servicesfor vulnerable consumers.
Course Outline:
Upon completion of this course, participants will be able to:
- Apply the principles of Fair Treatment of Consumersin all debt collection and debt counselling activities.
- Comply with the regulatory requirementsfor ethical and responsible debt collection practices.
- Identify consumers facing financial difficultiesand understand the procedures for offering assistance.
- Effectively manage and document revised repayment/payment arrangementsin accordance with CBUAE guidelines.
- Provide clear and comprehensive informationto consumers regarding debt management options and revised arrangements.
- Handle consumer complaints related to collections and debt counsellingin an efficient and respectful manner.
- Recognise the specific needs of vulnerable consumersand apply appropriate approaches in debt collection and counselling.
- Contribute to the Licensed Financial Institution’s compliancewith the CBUAE Consumer Protection Regulation and Standards.
Training Methodology:
- Interactive lectures and presentations focusing on real-life scenarios encountered in collections and debt counselling.
- Case studies analysing examples of compliant and non-compliant practices.
- Group discussions on challenges and best practices in applying the regulations.
- Role-playing exercises simulating interactions with consumers in arrears and those seeking debt counselling.
- Review of internal policies and procedures in light of the CBUAE requirements.
- Q&A sessions to address specific queries and concerns.
Target Audience:
Staff members working in the Collections Department and Debt Counselling Department of commercial banks.
Assessment Methods:
- Short quizzes or polls during the session to check understanding of key regulatory points.
- Observation of participation in discussions and role-playing exercises.
- Case study analysis – applying learned principles to given scenarios.
- (Optional) A brief written knowledge check at the end of the session focusing on key articles and clauses relevant to collections and debt counselling.
- Feedback forms to evaluate the effectiveness of the training.