Banks Prohibited from Imposing Fresh Credit Card Fees by the Supreme Court
Let's dive into the latest banking drama unfolding in Russia 🚀
The High Court's Verdict ⚖️Contrary to what some banking institutions may believe, the law doesn't hand them a magic wand to unilaterally rewrite the terms of a contract or slap on new fees, as this would only heap more financial stress on the borrower under a consumer credit agreement, the Supreme Court of Russia clarified in a recent ruling.
The Spark Ignites 🔥This ruling came aboutafter a resident from St. Petersburg kicked up dust. In 2022, he managed to snag a credit card from Alpha Bank, promising him the freedom to withdraw up to 50,000 rubles per month without any pesky fees. But, a mere month later, the bank had the audacity to slap on a 5.9% fee of the sum, plus an additional 900 rubles. Alpha Bank justified this move by claiming they had the right to change tariffs unilaterally, according to the contract.
The Courts' Initial Verdicts
- The resident from St. Petersburg, finding himself burdened with unexpected fees on his Alpha Bank credit card, decided to challenge this action in court.
- In response to the resident's argument, several lower courts initially ruled in favor of Alpha Bank, accepting the bank's claim that it had the right to impose new fees as stated in the contract.
- However, the resident appealed the decision, emphasizing that such moves by banks could potentially invalidate business practices and put a financial strain on consumers, as ruled by the Supreme Court in 2022.
- As a result, the Supreme Court of Russia overturned the previous rulings, clarifying that banks must respect the original terms of a contract and cannot unilaterally enforce new fees without proper justification.
