Payment accounts

The Law of 13 June 2017 on payment accounts (“Law on payment accounts”) contains provisions on the following subjects:

• transparency and comparability of fees related to payment accounts;
• switching payment account; and
• access to payment accounts with basic features.

The CSSF has been empowered to ensure the application and enforcement of the Law on payment accounts. In this respect, the CSSF has been granted all supervisory, inspection and investigation powers that are necessary for the exercise of its functions. The CSSF may take sanctions against professionals who breach the Law on payment accounts (warning, blame, administrative fines up to 250.000 EUR, prohibition to offer payment accounts).

Furthermore, the CSSF is competent to receive complaints from consumers concerning professionals subject to its supervision in relation with the application of the Law on payment accounts and to act as an intermediary in order to seek an amicable (extrajudicial) settlement of these complaints.

The payment account is an account which is held in the name of one or more consumers and which is used for placing, transferring or withdrawing funds. For instance, a current account is a payment account.

In order to ensure that consumers receive transparent information on payment accounts, the Law on payment accounts foresees that payment service providers provide consumers with:

• a fee information document and
• a statement of fees.

Fee information document

The Law on payment accounts provides that consumers will receive, in due time before entering into a contract for a payment account, a fee information document from payment service providers.

The fee information document will inform consumers on the fees that are charged for the following services in case they are offered by payment service providers:

• maintenance of a payment account;
• providing a credit card;
• providing a debit card;
• arranged overdraft;
• sending money;
• standing order;
• direct debit; and
• cash withdrawal.

Statement of fees

The Law on payment accounts provides that consumers receive at least annually and free of charge a statement of fees from their payment service providers. In the statement of fees, consumers will find a list of all the fees relating to their payment accounts that have been charged to them over a year.

In accordance with the Law on payment accounts, the CSSF has established a comparison website concerning fees charged for the most representative services linked to a payment account by payment service providers which:

• have at least 25 agencies in Luxembourg and hold at least 2.5% of the deposits as defined by point 36 of Article 1 of the Law of 18 December 2015 on the failure of credit institutions and certain investment firms, as amended, or which
• have expressly requested the CSSF to publish their fees on the comparison website.

The comparison website of the CSSF can be found by clicking on the following link: http://www.frais-compte-paiement.lu.

It is to be noted that the fees that are published on the comparison website of the CSSF may not correspond to the fees that payment service providers might apply to their clients when offering a package of services.

The Law on payment accounts contains provisions concerning the transfer by consumers in Luxembourg of all or part of the payment services that are attached to their payment accounts (e.g. credit transfers, direct debits and standing orders) to a payment account held by another payment service provider. The Law on payment accounts provides that consumers who do not wish to carry out the switching on their own may “authorise” their “new” payment service provider to carry out all tasks that are required by that transfer to happen smoothly.

Consumers will define in their authorisation in writing the different tasks to be fulfilled by the “new” payment service provider and inform it of the date on which standing orders or direct debits that are linked to the payment account to be transferred have to be carried out.

It is to be noted that the Law on payment accounts provides that fees charged to consumers within the accomplishment of the payment account switching process shall be reasonable.

Article 23(1) of the Law on payment accounts provides that banks and POST Luxembourg (defined hereafter as “concerned establishments”), which have at least 25 agencies in Luxembourg and hold at least 2.5% of the deposits as defined by point 36 of Article 1 of the Law of 18 December 2015 on the failure of credit institutions and certain investment firms, as amended, must offer payment accounts with basic features to consumers.

The following concerned establishments must provide consumers with payment accounts with basic features in Luxembourg:

• Banque et Caisse d’Epargne de l’Etat, Luxembourg;
• Banque Internationale à Luxembourg;
• Banque Raiffeisen;
• BGL BNP Paribas;
• POST Luxembourg.

A payment account with basic features includes the following services:

• services enabling all the operations required for the opening, operating and closing of a payment account;
• services enabling funds to be placed in a payment account;
• services enabling cash withdrawals,
• execution of the following payment transactions:
  • direct debits;
  • payment transactions through a payment card, including online payments; and
  • credit transfers including standing orders.

The Law on payment accounts provides that the concerned establishments that offer payment accounts with basic features may refuse an application for the opening of such an account where a consumer already holds a payment account with a concerned establishment in Luxembourg which allows him/her to make use of the services listed above. An application for opening a payment account with basic features may also be rejected if the consumer gave false or deceptive information within the application process or if the concerned establishment has reasons to suspect that the payment account with basic features would be used for an unlawful purpose.

In case a concerned establishment rejects an application for the opening of a payment account with basic features, the concerned establishment informs the applicant as soon as it has taken its decision of the dismissal of the application and informs the applicant of the grounds on which said decision was taken.

The concerned establishment must also inform the applicant of the procedure the applicant has to follow if s/he wishes to appeal against the dismissal of her/his application. The concerned establishment must inform the consumer of her/his right to lodge a complaint with the CSSF and must provide the relevant contact details.

A consumer may also appeal to the CSSF if s/he considers that her/his payment account with basic features has been unlawfully terminated by the concerned establishment.