- Review of 1,748 bank and savings bank terms, with correction requests for 14 types of unfair terms
The Korea Fair Trade Commission (KFTC) has reviewed a total of 1,748 terms used by banks and savings banks and has identified 79 clauses (14 types) that infringe on the rights of financial transaction customers, requesting corrections from the Financial Services Commission (FSC).
The KFTC conducts annual reviews of newly established or revised financial transaction terms from banks, savings banks, specialized credit finance companies, and financial investment businesses. To protect the rights of financial transaction customers more swiftly, the KFTC has prioritized requests for correction in the banking and savings bank sector, where the review has been completed.
Notable types of unfair terms include clauses that allow banks to unilaterally suspend or restrict services, potentially causing unpredictable harm to customers. For instance, a clause that permits service limitation based on “other reasons determined by the bank” allows for arbitrary service restrictions that customers cannot anticipate at the time of contract.
Another problematic clause is one that presumes customer consent in the absence of action. Such presumption clauses may be permitted if customers are clearly notified, but this particular clause lacks individual notification, which could lead to unintended consequences for customers without their awareness.
Additionally, clauses that skip individual notification procedures, regardless of their significant impact on customers’ rights or obligations, were deemed problematic. For example, terms that allow for automatic service suspension due to prolonged inactivity without prior notice or simply by posting on a website limit customers' procedural rights and were considered unfair.
Moreover, clauses that allow banks and savings banks to unilaterally determine or change the contents of benefits were judged unfair, as the core elements of a contract should not be decided or altered unilaterally by one party.
Through this correction request, many unfair terms are expected to be amended, thereby strengthening the responsibilities of banks and savings banks and preventing potential harm to financial transaction customers, including consumers and small businesses.
The KFTC plans to promptly request corrections for unfair terms in the specialized credit finance and financial investment sectors that are currently under review, while continuing to work closely with financial authorities to prevent the repeated use of unfair terms in the financial industry.