Instructions of the Internal Procedures for Handling Consumers’ Complaints of Financial and Banking Services Providers

1 No.: 27/ 1/11628 Date: 06/ 12/ 1438 : 28/ 08/ 2017 Instructions of the Internal Procedures for Handling Consumers’ Complaints of Financial and Banking Services Providers No. (1/ 2017) Issued pursuant to paragraph (b/ 13) of Article (4) and paragraph (b) of Article (65) of the Central Bank of Jordan Law No. (23) of 1971 and its amendments These Instructions shall set the general regulatory framework for the internal policies and procedures that must be put in place by financial and banking services providers regulated by the Central Bank of Jordan (CBJ), to handle consumers’ complaints. This will ensure that consumers will access various financial and banking services in an integrated framework of transparency and disclosure during the financial engagement with the service provider, without compromising and harming their interests. However, this will enhance the confidence in the providers of financial and banking services, increase their competitiveness, and protect them against reputational risks, which will eventually contribute to achieving the sustainable economic development, the financial stability, and strengthening financial inclusion. Article (1): These Instructions shall be called “Instructions of the Internal Procedures for Handling Consumers’ Complaints of Financial and Banking Services Providers”; and their provisions shall apply to all banking and financial services providers under the supervision and oversight of the CBJ. Article (2): Definitions a. The words and phrases mentioned in these Instructions shall have the meanings stipulated in Article (2) of the Banking Law No. (28) of the year 2000 and its amendments, as well as Article (2) of the CBJ Law No. (23) of the year 1971 and its amendments.

2 b. The following words and phrases shall have the meanings assigned to them thereto wherever they appear in these Instructions unless the context indicates otherwise: Internal procedures for handling consumers’ complaints Policies and procedures adopted by the service provider to handle consumers’ complaints, which govern receiving, registering, and investigating complaints, as well as responding to them within a specific time frame, and preparing periodic reports. The Central Bank The central bank of Jordan (CBJ). The Service provider All regulated banks and their branches and offices operating in Jordan, and all regulated financial institutions. The Financial institution An entity that performs financial activity(s) stipulated in the banking law except accepting deposits. The Customer/ Client/ Consumer Natural or legal person who had used or accessed to products and/ or services provided by the service provider. The complainant The customer or his/ her duly authorized person who filed the complaint. The complainant could be a previous or current client to the service provider. Complaint Any expression of customer’s dissatisfaction of a product and/ or service, plaint, or claim against a harm that affected the customer’s interest arising from the activities, products, or services of the service provider, or the way the complaint was handled. Consumers complaints handling unit Hereinafter “the unit”; the department/ division, or the employee(s) responsible for handling consumers’ complaints according to the provisions and requirements of these Instructions.

3 Duties and Responsibilities of the Service Provider Article (3): Approving Policies and Procedures for Handling Customers’ Complaints a. The service provider shall develop a documented policy for consumers’ complaints handling, which allows for responsible business conduct to better serving customers in all stages of the relationship between the service providers and their clients. The Board of directors / Executive management/ regional manager of the service provider shall verify the effectiveness and adequacy of adopted procedures of consumers’ complaints handling. b. The service provider shall put in place documented internal procedures to implement the consumers’ complaints handling policy, which shall be approved by the Board of directors/ Executive management/ regional manager of the service provider. These procedures shall be revisited annually by the service provider, or when deemed necessary, and must copy the policy to the CBJ and any amendments thereto. c. Pursuant to article (3/b), the service provider is committed to embed the procedures of handling customers’ complaints of subsidiaries, if any, to the internal working procedures, providing that the articles of these Instructions are applied to the subsidiaries as well. d. The service provider must conduct appropriate mechanisms for receiving complaints through the headquarters, all branches, and points of sale, or through subsidiaries. The service provider also shall accept all complaints sent from the CBJ. e. The service provider shall not charge any fees or commissions on submitted complaints, except what is stipulated in related effective regulations. f. The service provider may not impose any restrictions or conditions that hinder the consumer’s ability to file a complaint, or forcing the client to withdraw the complaint, unless the customer is willing to do so.

4 Article (4): The Underlying Objectives of Customers’ Complaints Handling Policy The service provider must consider achieving the following objectives when developing consumers’ complaints handling policy: a. Setting standards that aiming to provide a featured service, which shall be embraced by the service providers’ employees, providing that the customer has the right to lodge a complaint which must be handled by the service provider impartially and apart from the point of view of the employee who received the complaint. b. Raising customers’ awareness about the services and products provided by the service provider, and the mechanisms and procedures of handling any complaint submitted by consumers if they are not satisfied with any of the products or services provided. c. Finding appropriate and definitive solutions for customers’ complaints in order to reduce their recurrence. d. The continuous endeavor to reduce the number of complaints, and the time frame for handling them. Article (5): Establishing A Unit for Handling Consumers’ Complaints a. The service provider shall set up a specific organizational unit devoted to handle consumers’ complaints. Establishing the unit shall be based on the service provider’s1 capital, the financial activity which the service provider is licensed for, the size of activities, number and diversification of provided products and/ or services, number of complaints received, as well as number of branches and/ or subsidiaries. b. As for banks; the unit shall be subordinate to the Compliance Control Department to ensure the independence and impartiality, while for financial institutions; the unit shall be subordinate to the general manager. Each financial institution shall report to the CBJ the organizational structure of the unit, considering what is stipulated in paragraph (a) of this article. c. The service provider must furnish the unit with employees and carry out training programs to enable them handling consumers’ complaints efficiently and effectively.

1 As for financial institutions with no branches, and less than (10) employees, the consumers’ complaints handling shall be the responsibility of one of its employees.

5 d. The unit’s staff shall have sufficient knowledge of all services and/ or products provided by the service provider to customers, as well as familiarity with effective laws and regulations regarding financial consumer protection. e. The unit shall be committed to handling consumers’ complaints without discrimination or distinction between customers, and in a clear and effective manner that is fairly provided to all customers of the service provider. f. The director of the unit -or the deputy- at banks shall have direct contact with the Compliance department’s director to ensure that complaints are handled in accordance with the CBJ’s relevant Instructions and guidelines, and to take the necessary procedures to deal with prompt complaints or those that may impose high risks on the bank's reputation. Meanwhile, the unit at financial institutions shall be subordinate to the general manger as mentioned in article (5/b) of these Instructions. g. The service provider shall appoint a liaison officer with the CBJ and an alternative officer from the unit’s employees, and determine the contact information of these officers and notify the CBJ with any change or amendment thereto. h. The complaints handling unit must be separated from the customers’ service, as the unit is responsible for investigating and deciding on complaints and respond to them on time periods specified in these Instructions. Complaints Not Handled by The Unit Article (6): Complaints excluded from the provisions of these Instructions a. Complaints brought before the courts, or if an adjudication has previously issued, providing that the complainant shall be notified that he/ she must provide this information to the service provider prior to receiving the response of the service provider regarding the complaint. b. Complaints concerning labor and trade unions issues. c. Complaints with no name or information about the complainant. d. Complaints related to anti money laundering and counter terrorism financing issues. e. Inquiries and questions of clients. f. Complaints including an abuse and/ or words of (aspersion, threatening, bad words…)

6 Customer's Right to File a Complaint Article (7): Informing Customers of Their Right to Submit Complaints a. The service provider must enclose in the contracts with customers a special clause highlighting the customers’ right to submit any complaint about the services or products provided. This clause shall be enclosed separately in another document attached to the contract, or inform the customer through the engagement letter. b. The service provider shall inform customers about their right to file complaints through at least the following means: 1.Brochures and leaflets; so that they are clearly located in the headquarters, branches, offices, and subsidiaries of the service provider. 2. The website of the service provider. 3. Emails and text messages. 4. Electronic plates - if any. 5. Social media-if any. c. The service provider shall orally inform the customers with special needs who cannot read and write about their rights to file a complaint at the beginning of the banking/ financial relationship. d. Acknowledging customers of their right to file a complaint must include, at least, the following information:

1. Time frame for dealing with complaints.
2. Clarify to customers that in case of dissatisfaction with the service provider’s response to their complaints, they may proceed to resort to the CBJ, or to the court, and providing customers with the means of communication with the CBJ which are listed on the CBJ’s website.
3. The means available to submit a complaint which are indicated in Article (8) of these Instructions. e. Financial institutions that have agents for marketing their services and / or products shall inform their clients that any complaint about the agent or any of the services and/ or products provided to the customer is solely the responsibility of the financial institution.

7 Procedures of Receiving and Handling Customers’ Complaints Article (8): Means for Filing A Complaint The service provider must provide all means and tools through which the customer can submit a complaint, including at least the following:

1. Mail address.
2. E-mail and e-channels of the service provider.
3. Toll free line; providing that calls shall be registered.
4. Personal attendance. 5.Complaints and suggestions boxes located in the branches of the service providers.
5. Fax. Article (9): Referral Letter a. The service provider must confirm to the customer the receipt of the complaint using the means by which the complaint was submitted, or any means agreed with the customer. b. The referral letter should include the following information:
6. A reference number for the complaint.
7. Full name of the complainant.
8. The contact information of the complainant.
9. The subject of the complaint.
10. The date of receipt of the complaint.
11. Phone number and e-mail of the complaints handling unit at the service provider to follow up the complaint.
12. The anticipated time frame period required by the service provider to respond to the customer regarding the complaint in accordance with Article (12) of these Instructions.
13. The mean chosen by the complainant to inform him/ her of the decision on the complaint and respond to it. c. If the complaint was received by phone, the service provider must request the complainant to provide convenient means of communication to receive the referral letter, provide a reference number, and inform the complainant about his/her right concerning complaints handling. If the complainant is not satisfied with the information contained in the referral letter, the complainant should be informed that he/ she has the right to check with the service provider to give feedback on the information included in the letter, upheld with relevant documents, in a period not exceeding (10) working days.

8 d. If the complaint is solved by the service provider promptly on the same day of receipt, providing that the complainant accepts that, then there is no need to provide a referral letter, adhering strictly to Article (11) of these Instructions. e. In case the information or documents were not complete, the complainant shall be notified by agreed means of communication within (5) working days at maximum to complete the complaint file, and the customer shall provide the requested information or documents within (5) working days, otherwise, the complaint is deemed cancelled and a new application and a new reference number are required. Article (10): The Responsible for Handling Complaints a. The Unit's staff at the service provider shall be responsible for ensuring that all customers’ complaints are well received, documented, recorded and followed up effectively starting from receiving the complaint until finalizing the procedures of handling and responding to the complainant. b. If the employee receiving the complaint cannot solve it promptly, a simple and clear explanation must be provided to the complainant regarding the procedures of handling the complaint in addition to a reference number for the complaint pursuant to Article (11) of these Instructions, as well as keeping the complainant on up to date progress regarding his/ her complaint. Article (11): Registration of Complaints a. The service provider must create an electronic system/ record2 to register all incoming complaints in such a way as to provide a reference number for each complaint. This number will be used in all correspondence between the service provider and the complainant, as well as any correspondence with the CBJ. b. The electronic system/ record must include at least the information mentioned in the Annex attached to these Instructions. c. The service provider must record all communications, procedures and documents relating to the complaint in the electronic system/ record.

2 As for financial institutions with no branches, and less than (10) employees, the complaints shall be recorded in a special file designated to this purpose,

9 d. The service provider shall retain all information about customers’ complaints inserted and stored in the electronic system/ record for at least (5) years as from the date of closing complaints, or according to the retention periods stipulated in relevant legislations, if any, whichever is more. e. The service provider must keep any documents or records relating to the complaint in an organized manner for easy reference by authorized employees or the CBJ’s staff. Article (12): Time Frame for Complaints Handling a. The service provider shall evaluate, handle, and make the appropriate decision on the complaint, as well as responding to the complainant within (10) working days from the date of receipt of the complaint and all relevant documents. This period may be extended for another (10) working days if necessary, and the complainant shall be informed with the justification for such extension. b. If the service provider requires more than the time period mentioned in paragraph (a) above; any subsequent extension of the first extension must be approved by the higher administrative level to which the unit is subordinate, providing that this shall be recorded in the complaints system/ record and the complainant must be notified of this extension and its justification. At any time; the extension period shall not exceed (10) working days. c. In all cases, the time period for handling a complaint must not exceed (30) working days from the date of filing the complaint. d. If the service provider requests the complainant to provide more documents after receiving the complaint, the waiting period will not fall into the periods specified in this Article.

10 Article (13): Complaints Handling and Following Up a. The service provider shall inform the complainant in writing - or by any agreed means previously selected by the complainant- with the final result of the complaint submitted, in a plain and simple language avoiding misinterpretation and using any technical and specialized concepts. b. The response to the complainant's complaint should include, at least, the following information:

1. The complaint’s reference number.
2. The subject of the complaint.
3. Final decision regarding the complaint.
4. A summary that includes the justifications for the decision.
5. Contact information of the complaints handling unit of the service provider if the complainant is willing to obtain additional clarifications.
6. The procedures that the complainant is entitled to do if he/ she is not satisfied with the solution provided by the service provider, in terms of the possibility to proceed to the CBJ or the court. c. If the complainant receives a compensation, the details must be clear to the complainant, in addition to informing him/ her about his/ her right to accept or refuse the remuneration within (10) working days of receiving the reply. d. If the complainant did not clarify whether he/ she has accepted the compensation within (10) working days, the compensation will be deemed accepted, and shall be paid by the service provider to the complainant, and recorded in the electronic system/ record. e. The service provider is obliged to fulfill what is agreed with the complainant regarding the submitted complaint, and the complainant shall sign for approving. f. The complainant's approval shall be verified and recorded in the electronic system/ record as stipulated in Article (11) of these Instructions.

11 Submitting Complaints to Subsidiaries Article (14): Subsidiaries of the Service Providers a. If the service provider has a subsidiary, the subsidiary must inform all customers of their rights to file and submit complaints either to the service provider or the subsidiary. b. If the complaint is submitted to the subsidiary, it must be handled according to internal procedures agreed between the service provider and the subsidiary, as these procedures shall be enclosed in the policy of consumers’ complaints handling of the service provider as stipulated in Article (3) of these Instructions. However, if the subsidiary submitted the complaint to the service provider for handling, the complainant shall be notified. c. For the purposes of the deadlines indicated in Article (12) of these Instructions, the date of receipt shall be the date of receiving the complaint by the subsidiary. d. If the response to the complaint involves a compensation, it shall be paid by the service provider or the subsidiary according to the internal procedures included in the approved consumers’ complaints handling policy, as the service provider shall be responsible for this. Analyzing and Evaluating Customers Complaints and Reports Article (15): Analysis and Evaluation of Complaints The service provider shall periodically conduct a comprehensive analysis of all received complaints (whether closed or pending) to identify complaints that may affect the reputation and financial position of the service provider, determine the frequency of such complaints, and initiate remedial and proactive actions to prevent their occurrence in the future. Article (16): Periodic Reports a. The unit must at least quarterly furnish the Compliance department/ general manager of the financial institution with a statistical analytical report on complaints received, and copy this report to the executive management. This report may contain at least the following:

1. Number of complaints received by the service provider.
2. Number of complaints resolved, rejected complaints (fall outside the unit’s responsibility, or incomplete complaints), and pending complaints.

12 3. The compensations paid by the service provider and/ or the subsidiary, if any. 4. Classification of complaints according to:

• Themes; which are listed in the annex attached to these Instructions.
• Products and services which complaints were filed against.
• Branches, offices, and subsidiaries.
• Time frames for handling complaints. b. The report should include measures taken to handle complaints and recommendations of the unit to make any amendments or improvements in the procedures of complaints handling to reduce their number, including but not limited to (increase the activity of the service provider in promoting financial literacy, change the marketing procedures, change the features of the products and services subject to complaints, training of branches and offices’ employees, and addressing frequent complaints). c. The Board of directors/ Executive managers/regional manager of the service provider shall discuss the complaints evaluation report and the procedures taken to handle them, in particular frequent complaints, the causes, and consequences on other services and products where no complaints have been filed against, as well as any potential impact of such complaints on the reputation of the service provider. The minutes of the meeting must include the recommendations regarding the complaints assessment report. d. The service provider should include the results of complaints evaluation report in the service provider's annual report under the disclosure and transparency section, and copy this report to the CBJ. Evaluate the Service Provider's Policies and Procedures Regarding Consumers’ Complaints Handling Article (17): Internal Audit The annual internal audit plan of the service provider shall include a review of the procedures for handling customers’ complaints in accordance with these Instructions and other relevant Instructions, and recommend any amendments to these procedures to increase their efficiency and effectiveness. The internal audit reports sent to the Board/executive managers/ general manager should include the results of evaluating the service provider’s procedures of handling customers’ complaints.

13 Filing A Complaint to the CBJ Article (18): a. The complainant is entitled to file a complaint to the CBJ in the following cases:

1. The complainant is not satisfied with the service provider response.
2. The service provider did not respond to the complainant within the deadlines specified in these Instructions.
3. The service provider refuses to accept the complaint. b. For received complaints attributed to the cases (1) and (2) stipulated in paragraph (a) of this Article; the CBJ will ensure that the customer has firstly referred to the service provider through the reference number of the complaint and/ or receiving a reply from the service provider on the complaint. c. If the CBJ verified that the customer is entitled to file a complaint, the CBJ will request the service provider to take corrective action and/ or provide justifications and notes in this regard. The service provider shall reply to the CBJ within (10) working days. Article (19): a. If the service provider or any of its subsidiaries breach any of the provisions of these Instructions, the CBJ may impose any of the penalties or procedures stipulated in the provisions of the CBJ Law No. 23 of 1971 and its amendments, and/ or any relevant laws and regulations governing the business of financial and banking services providers issued by the CBJ. b. The service provider is responsible for correcting its followed procedures if a complaint revealed any misalignment, and this shall be applied to all customers even if no complaints were submitted from these customers. This shall be subjugated to the penalties indicated in article (19/ a).

14 General Provisions Article (20): a. The service provider shall quarterly submit the complaints’ report to the CBJ not later than (15) days from the end of each quarter, and complaints shall be classified by theme (illustrated in the annex), as well as the actions taken in respect thereto. b. The CBJ has the right and by the methods it deems appropriate to monitor the fairness, adequacy and quality of the procedures taken by the service provider to handle customers’ complaints. The CBJ may ask the service provider to take necessary measures to strengthen its complaints handling mechanism. c. The service provider shall develop clear working procedures that ensure the protection of consumers’ data and information, and keep them confidential, as well as providing a convenient environment for protecting these data and information. The service provider must follow required procedures that ensure the employees commitment to not misuse, or reveal customer’s data and information during and after their work with the service provider. Article (21): These Instructions shall be in effect after (90) days from the date of issuance. Any issued Circulars/ Instructions, or paragraph(s) in the CBJ’s circulars/ Instructions which are in discrepancy with these Instructions shall be superseded. Governor, Dr. Ziad Fariz

15 Annex: Components of Electronic Record The electronic record of consumers’ complaints shall include at least the following information3 : Category First level of information Second level of information General Information Complaint reference number Date of receipt of the complaint Complainant’s full name Date of birth ID number Contact information Mail address Phone number E-mail Type of complainant Individual Small company Other The service provider being complained against Bank/ financial institution Branch Subsidiary Agent Office The product/ service being complained against Summary of the complaint Documents attached with the complaint The employee responsible for handling the complaint The decision on the complaint and the closing date Means to submit a complaint Means for filing a complaint Regular mail E-mail Phone Personal attendance other Additional correspondences Date Mean of communication Context Extending time periods for the complaint No. of days Justification The employee authorized for extending the period.

3 Depends on products and services provided by the service provider.

16 Category First level of information Second level of information Type and theme of the complaint Electronic services Payment services eFAWATEERcom payments, or any other payments systems via the service provider portal Online banking ATMs Fees and commissions Commissions on products Commissions on services Fees on products and services Interest rates/returns Interest/ returns on deposits Interest/ returns on loans and credit cards Business conduct Refusal to provide a service Conduct of employees Conduct of subsidiaries/ agents Difficulty in contacting the service provider Banking cards Payments via credit cards at merchants and points of sale Payments via debit cards at merchants and points of sale Online payments via credit cards Online payments via debit cards Marketing of products and services Advertisement Sales Contracts and Terms Agreement/ contract Transactions on the account Insurance of products Deposits Loans and credit Non providing of a product Collection practices Business environment Providing the service with a delay The employee is not cooperative in providing the service Workplace Transfers The money transfer is delayed4 The service provider did not carry out the transfer for reasonsout of his control 5 The client is not notified with the transfer The service provider refused to conduct the transfer Other6 Exchange rates

4 Including salaries. 5 e.g. compliance to supervisory requirements, or corresponding banks; however, details must be indicated. 6 Details must be included.

17 Category First level of information Second level of information Documents enclosed with the complaint Documents provided at the date of submitting the complaint Documents provided later, and the date of receipt The final decision on the complaint and justifications Refusal of complaint Justifications Compensation Partial Full Compensation paid Apologize to the complainant Remedies The actions listed are examples for remedies taken by the service provider Improving marketing and advertisement procedures Improving communication with the service provider Develop financial literacy programs Improving infrastructure of e￾payments Amending/ changing contracts Training of employees Revisit charged commissions Review the features of products and services other Employees handling the complaint Employees responsible for handling the complaint Contact information