Nearly half of borrowers are signing loan agreements remotely through banking apps, according to a recent assessment by the Bank of Russia. Many borrowers do not read the terms and conditions due to the length of agreements, having to click a link, trust in their manager, being in a hurry, or difficulty understanding legal language.
The findings from this behavioral assessment reveal how financial consumers approach reading agreement terms. It identifies which sections are considered most and least important and highlights barriers preventing comprehension of critical information. Notably, many borrowers assume that all documents are standard and unchangeable, though customers have the right to amend terms.
The Bank of Russia intends to use these results to improve consumer lending regulation.