Ethiopia: Financial Consumer Protection (Directive No. FCP/01/2020) including consumer protection regulation entered into force

On 25 February 2021, the Financial Consumer Protection Directive No. FCP/01/2020 entered into force. The directive defines digital financial services as financial services including payments, remittances, and insurance accessed and delivered through digital channels (Section 2.11). It mandates that financial service providers offering such services must provide Key Facts Statements (KFS) to consumers, ensuring that these statements are clear, accurate, and easily understandable (Sections 5.2.4). The directive also requires that all information, contracts, and notices provided to consumers be transparent, legible, and available in multiple languages (Section 5.2.2). Regarding data protection, it requires that financial service providers keep consumer data confidential and secure, using it only for legitimate purposes agreed upon by the consumer or permitted by law (Section 4.4). Providers must also ensure that any third party handling consumer data maintains the same level of confidentiality and security (Section 5.4.8). Additionally, the directive outlines internal complaint-handling mechanisms and establishes a framework for reporting complaints to the National Bank of Ethiopia (NBE) (Sections 5.5.2 and 5.5.3). Training and supervision of agents involved in digital financial services are also required to ensure compliance with the directive (Section 6.3.4). Non-compliance with these provisions could lead to penalties of ETB 10'000 per violation (Section 10.1).