[Q&A] "Apartment Group Loan Notices Also Considered Advertisements Under the Financial Consumer Protection Act"

At the 3rd Meeting of the Financial Services Act Implementation Task Force, 'Financial Advertising Regulation Guidelines' Established

[Asia Economy Reporter Sunmi Park] Does financial information broadcasting constitute advertising under the Financial Consumer Protection Act?

The Financial Services Commission, Financial Supervisory Service, and financial industry associations held the 3rd meeting of the Financial Consumer Protection Act Implementation Task Force and prepared the "Financial Advertising Regulation Guidelines" as explanatory materials regarding advertising regulations raised in the field after the Act's enforcement. Below are key Q&A contents related to the financial advertising regulation guidelines that financial industry and consumers should know.

Q. Does the association's financial product information comparison disclosure service constitute advertising under the Financial Consumer Protection Act?

A. The association's financial product information comparison disclosure service is difficult to be considered advertising as it is provided for public interest purposes under the Act.

Q. Does financial information broadcasting also constitute advertising under the Financial Consumer Protection Act?

A. Broadcasting that directly or indirectly provides information about financial products of a specific financial product seller can be regarded as financial product advertising. However, if financial information is provided without sales intent and measures are taken so that consumers cannot easily infer the financial product seller or financial product, it is difficult to consider it advertising. Broadcasts introducing services of specific financial product sellers or financial product advisors to induce financial transactions constitute business advertising. Broadcasts designed to promote sales of a specific company even without explicitly introducing a specific service also constitute business advertising.

Q. Does a bank's group loan information leaflet distributed to apartment residents before move-in constitute advertising under the Financial Consumer Protection Act?

A. Loan counseling and support for loan document preparation by loan counselors fall under financial product sales agency or brokerage under the Act, so acts informing related information constitute "business advertising" under the same law.

Q. Is it allowed to advertise specific financial product sellers or financial products on an online platform for financial product advisory services?

A. According to Article 25, Paragraph 5 of the Enforcement Decree of the Financial Consumer Protection Act, advisors are prohibited from advertising specific financial products or specific financial product sellers.

Q. How should the notation be made when internal review or association review has been conducted for advertising?

A. Financial product sellers or advisors must indicate in the advertisement that internal review or association review has been conducted according to laws and regulations. Since there are no specific legal provisions on the notation method, it should be indicated in a way that consumers can easily understand without deviating from the regulatory intent.

Q. When advertising loan products, the 'range and calculation basis of interest rates' must be included. Is it acceptable to state as currently done with terms like 'variable interest rate' or 'interest rate subject to change'?

A. The 'range and calculation basis of interest rates' under the Financial Consumer Protection Supervision Regulations is stipulated to prevent consumers from misunderstanding the core transaction condition of loan products, the interest rate. Expressions such as 'variable interest rate' or 'interest rate subject to change' do not meet this requirement.

Q. Regarding the mandatory inclusion of 'required credit level' in loan product advertising under the Financial Consumer Protection Act, how should it be implemented? Is it sufficient to state 'loan approval depends on internal review'?

A. Criteria necessary for consumers to judge the eligibility for loan product transactions, such as personal credit scores, must be presented. The statement 'loan approval depends on internal review' is inappropriate as a criterion for judging eligibility for loan product transactions.

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