The financial system constitutes a fundamental piece for the functioning of the economic system.
In order for economic relations to develop normally, it is essential that all economic agents have confidence in the financial system, which must provide the necessary means to support the performance of productive activity.
The foregoing explains that, in all countries, the public authorities have established a set of regulatory measures in order to guarantee the stability, solvency and transparency of the financial system.
The regulatory framework of the activity to which credit institutions are engaged is very extensive. In addition to being applicable, in general terms, the set of provisions that govern commercial activity, there are a large number of provisions that specifically regulate, and sometimes in a very detailed way, banking activity, establishing, for example, requirements to be met by the credit institutions to carry out their activity, the form and content of some contracts they enter into and the mechanisms for protecting clients.
In addition to banking regulations, strictly speaking, these institutions are also subject to the legal framework for the provision of investment services, insofar as they can offer these services, or for insurance mediation (bancassurance operators) if they mediate the contracting between insurance companies and policyholders.
The situation has become more complicated when a new generation of products has combined elements of the three sectors into which the financial system that we have just mentioned is divided (banking, financial instruments, insurance and pension funds), which is appreciated, for example, in mortgage loans to which a swap is linked to mitigate the risk of an interest rate rise, in unit-linked insurance or in guaranteed pension plans, which mix elements of investment, insurance and retirement and savings products, with differentiated tax treatments that can encourage their purchase.
Therefore, even if a client is related to a bank, the banking regulations or, in a broad sense, those of other sectors of the financial system, such as those referred to, may be applicable, so that the protection of the user of financial services may vary depending on what specific service they are taking out.
On the other hand, the following aspects of the set of regulations applicable to credit institutions affect customers in a special way:
- Pre-contractual information.
- Regulation of the basic content of contracts.
- Cases in which a copy of the contract has to be delivered to the client.
- Lately, due to the influence of the European Union regulation, the right of withdrawal in certain loan contracts concluded with consumers.
- Mechanisms to protect clients and solve incidents in the event of discrepancies with the actions of the financial institution.
