Supervision release 11 September 2023 – 49/2023

Thematic review of availability of banking services to foreigners moving to Finland

In the course of this year, the Financial Supervisory Authority (FIN-FSA) has reviewed banks’ practices in the provision of banking services to different groups of foreigners relocating to Finland.

The review was limited to services defined as basic banking services in the Credit Institutions Act. Banks providing payment services are under a statutory obligation to provide basic banking services equally and without discrimination to consumers residing legally in an EEA Member State.

Conclusions of the thematic review

 As a key conclusion, based on responses received from banks, the FIN-FSA finds that persons relocating to Finland from abroad as a rule have the possibility to obtain access to a basic payment account and related minimum services in the extent required by the Credit Institutions Act. Furthermore, the content of basic banking services provided to customers does not appear to be limited, at least to any major degree, by any restrictions that would be in conflict with legislation or otherwise inappropriate.

However, there are discrepancies between the responses given by banks on the provision of basic banking services and the perceptions of foreign customers regarding the availability of these services that are not entirely explained by the present review.

According to the FIN-FSA’s assessment, customers’ problematic perceptions may be affected by factors such as long waiting times at bank branches or unclear and inadequate communication regarding the documentation required by banks in order to open banking services. 

Interpretations and recommendations to banks

In conducting the review, the FIN-FSA also identified areas for correction or improvement.

To ensure the availability of basic banking services and the smoothness of banking, the FIN-FSA urges banks to consider, among other things, the following matters in their operations:

Time of commencement of service provision

The FIN-FSA states as its interpretation that the definition of a customer residing legally in an EEA Member State is met, and banks are thus obliged to provide basic banking services, in circumstances where the person has applied for asylum, temporary protection or other residence permit, and is residing in Finland on the grounds that the application is in process.

Basic banking services may not be contingent on a Finnish personal identity code

The FIN-FSA states as its interpretation that banks may not require a Finnish personal identity code as a precondition for opening basic banking services. An exception to this main rule is the granting of a strong electronic means of identification to the customer.

Due diligence information collected on the customer must be reasonable and proportionate to the risk

The FIN-FSA recommends that banks should not require the collection of unreasonably extensive customer due diligence information in order not to unduly withhold customers' access to basic banking services. 

Banks must ensure the availability and comprehensiveness of instructions for customers as well as internal guidelines 

The FIN-FSA recommends that banks provide information on basic banking services and practices related to application for the services in all of their customer service channels and always on their website, too.

Banks must also ensure that their internal guidelines concerning the provision of basic banking services and the training of service personnel are adequately comprehensive and clear.

The availability of personal customer service within a reasonable period of time must be ensured, and the processing times of applications must be monitored

The FIN-FSA urges banks to ensure the availability of personal customer service to anyone needing it, within a reasonable period of time. The statutory 10-day maximum period of processing a customer's application for a payment account with basic features loses its meaning if the customer is not allowed to submit an application within a reasonable period of time.

The FIN-FSA recommends that all banks systematically and regularly monitor and keep records of the processing times of applications for basic payment accounts. The monitoring methods can be chosen by the banks themselves.

Subsequent measures by the FIN-FSA

The FIN-FSA monitors the availability of basic banking services on an ongoing supervision basis.

In the course of its supervisory activities, the FIN-FSA will monitor whether supervised entities’ customer due diligence procedures are appropriate and how a risk-based approach is demonstrated in customer due diligence practices.

For further information, please contact

  • Pekka Vasara, Head of Division, pekka.vasara(at)fiva.fi
  • Anu Kettunen, Senior Legal Counsel, anu.kettunen(at)fiva.fi

Appendix