Kuwait's Central Bank has strengthened consumer protection with new banking guidelines.
In a major step to enhance financial transparency and protect customer rights, the Central Bank of Kuwait (CBK) has issued updated instructions under its Bank Customer Protection Guide, introducing a series of reforms aimed at improving banking practices and promoting financial inclusion across society.
The CBK emphasized that these measures are part of its ongoing efforts to ensure that all segments of society benefit equitably from banking and financial services under clear and transparent regulations.
Faster Complaint Resolution and Enhanced Accountability
Among the most notable updates—set to be fully implemented by April 2026—is the reduction of the period for responding to customer complaints from 15 to 5 working days.
Banks are now required to develop performance indicators to measure customer satisfaction and the quality of complaint handling. These indicators must be submitted quarterly to each bank’s CEO, ensuring faster and more transparent resolution processes.
Clarity on Credit Card Renewal Fees
A long-standing point of confusion regarding credit card renewal fees—particularly for MasterCard and Visa cards offered free for the first year—has now been resolved.
The Central Bank has made clear that banks may not collect any fees or expenses on cards that were initially granted free of charge and cancelled within the stipulated free period.
Furthermore, banks must ensure that all promotional offers clearly outline the terms and conditions of “free” services, ensuring customers are fully aware of their rights before committing.
Mandatory Customer Consent for Card Renewals
The updated guide introduces a new rule requiring explicit customer consent for credit card renewals.
If a contract includes automatic renewal, the bank must notify the customer at least three months before the renewal date through approved communication channels.
The notice must also explain the cancellation process and disclose any renewal-related fees, such as annual or service charges. Customers retain the right to use their product or service until the end of the contractual period unless they choose to cancel it.
Transparent Information and Fair Pricing
Banks are now obligated to provide customers with a basic information document outlining key details about products or services—such as features, fees, obligations, and eligibility criteria—before signing any contract.
This measure is designed to help customers make informed financial decisions.
To enhance transparency further, the CBK has introduced a requirement for banks to disclose the Annual Percentage Rate (APR) for all credit products. This will allow customers to compare offers and select the best rates, promoting greater competitiveness in the banking sector.
Additionally, the Annual Total Return (ATR) rate will be applied to deposits, enabling customers to identify the best savings rates and encouraging efficient use of surplus funds. Banks will also offer online calculators for financing products and credit cards, helping customers estimate appropriate installment levels based on income.
Special Provisions for Minors and People with Disabilities
The CBK has also issued new controls for dealing with minor clients, including requirements for notifying custodians when accounts are opened and granting them review rights. Banks are encouraged to develop age-appropriate products that improve financial literacy among younger customers.
For customers with special needs, banks must facilitate all transactions without requiring witnesses, unless specifically requested by the customer.
Financial institutions are also required to update their websites and digital platforms to comply with international accessibility standards.