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The gist of the case
A resident of Tatarstan received a car loan. The agreement’s personalised terms and conditions stated that the interest rate was 13.5 per cent per annum.
The interest rate under the loan agreement is valid upon execution of the additional option “N…”. At the same time, if the client fails to comply with the condition to insure the purchased car, the loan rate will amount to 17.3 per cent. The commission fee for the option “N…” totalled RUB 53,873 for a loan size of RUB 979,513.
A few days later, the client applied to the bank refusing to accept the additional service and demanding the money back for it, claiming that the service had been imposed by the bank when the loan agreement was concluded. The bank refused to satisfy the consumer’s claims.
Position of the Financial Ombudsman
The inclusion of the option “N…” is, in fact, an action of the bank to agree on the personalised terms and conditions of the loan agreement. Accordingly, the subscription of the consumer to the option “N…” does not create for her a separate property benefit outside the credit obligation, i.e. an independent value, but only establishes the rights and obligations of the parties directly in the credit legal relationship, therefore it is not a service within the meaning of Article 779 of the Russian Civil Code. Such coordination of the terms of the loan agreement is carried out in accordance with the procedure provided for by Law No. 353-FZ, and not by concluding an agreement on the provision of a particular service for a certain fee.
In accordance with Article 809 of the Russian Civil Code and Articles 5 and 6 of Law No. 353-FZ, the fee for a loan constitutes interest. At the same time, in this case, the additional fee is charged in a fixed amount, does not depend on the period of loan use and essentially replaces the interest rate.
The court’s standpoint
The court of first instance ruled that the fee for the additional option was lawful.
However, the Supreme Court of the Republic of Tatarstan upheld the complaint of the Financial Ombudsman, cancelled the decision of the court of first instance, and left the Financial Ombudsman‘s decision unchanged (2-4425/2022, Nizhnekamsk City Court of the Republic of Tatarstan). The appeal court concluded that the option “N…” was nothing else than the agreement between the bank and the client of an essential condition of the loan agreement – the final amount of the interest rate under the consumer loan agreement, which was a statutory obligation of the bank in accordance with Part 9 of Article 5 of Law No. 353-FZ, and therefore was not a separate service in accordance with the provisions of Article 779 of the Russian Civil Code.
The court also concluded that the option provided even extra and excessive costs for the consumer, which is confirmed by comparing the preliminary calculation under the loan agreement without interest rate reduction and the loan repayment schedule with the reduced rate under the option “N…”.
Charging the creditor a fee for reducing the interest rate on the loan agreement, the amount of which̆ was an essential condition of the loan agreement and was subject to agreement by the parties to such agreement at its conclusion, and subsequently could be reduced by the creditor unilaterally in accordance with paragraph 16 of Article 5 of Law No. 353-FZ, unlawfully charges the consumer with compensation for the creditor’s losses in establishing a lower interest rate on the loan.
