EC Calls For COVID-Inspired Consumer Protections

“We are stepping up consumer protection on two fronts: we are making it easier for consumers to avoid risks related to having a credit and we are putting even stronger rules for product safety in place,” Věra Jourová, vice president for values and transparency, said in a news release. “It will also put more responsibility on market players and make it more difficult for bad actors to hide behind complicated legal jargon.”

The commission says its move is prompted by the way COVID-19 has accelerated digitization while leaving many people facing financial uncertainty.

Last year, 71 percent of consumers shopped online, often purchasing new gadgets. The commission’s proposed General Product Safety Regulation will introduce product safety rules for online marketplaces to address risks such as cybersecurity threats.

“The new regulation will make certain that marketplaces [fulfill] their duties so that consumers do not end up with dangerous products in their hands,” the commission said.

The EC is also proposing a revision to the Consumer Credit Directive, which mandates that credit information must be presented clearly and adapted to digital devices so consumers understand what they’ve signed up for.

The directive also overhauls rules for determining creditworthiness to prevent consumers from becoming over-indebted and asks member states to provide better financial education.

The EC’s proposal comes at a time when open banking technology has become a crucial part of eCommerce growth, as a recent PYMNTS report discovered. As digital marketplaces and brands unveil or expand their eCommerce options, the ability to offer secure, fast scalable payment infrastructures has grown in importance.

The report found that open banking adoption has surged in Europe and the U.K. in the past three years due to its flexibility and growing popularity with banks and consumers. Download a free copy of the report to learn more.