On 19 August 2025, the MFSA issued a Dear CEO Letter following a Thematic Review on payment accounts offered by Financial Institutions. This review assessed whether firms are meeting their obligations under the Payment Accounts Regulations (S.L.371.18) and related EU technical standards, with a particular focus on the Fee Information Document (FID), Statement of Fees (SOF), and transparency in consumer communication.
Background and Scope
The Payment Accounts Regulations are designed to ensure fee transparency, comparability, and fairness for consumers. Institutions must provide clients with a Fee Information Document before entering into an account agreement and an annual Statement of Fees free of charge. Additionally, firms are required to maintain accurate information on the MFSA’s Payment Accounts Fees Comparison Tool.
The MFSA’s review covered Financial Institutions offering accounts with all key features under the Payment Accounts Regulations, namely deposit-taking, cash withdrawals, and payment transactions.
Key Findings
The review revealed several compliance weaknesses:
- Fee Information Document (FID):
While most institutions adhered to formatting requirements under EU Regulation 2018/34, improvements are needed. Specifically, FIDs must always be provided in good time before contract conclusion. Furthermore, service names must precede brand names to avoid confusion. Lastly, glossaries should be issued as separate documents, available in English, Maltese, and other agreed languages. - Statement of Fees (SOF):
One institution failed to comply with EU Regulation 2018/33. SOFs must present a full breakdown of all fees, mirroring the FID, to ensure clarity and transparency for consumers. - Fees Comparison Tool:
Institutions were not consistently updating their fee data. In one case, a discontinued product still appeared on the tool. Firms must ensure timely updates and promptly inform the MFSA when products are withdrawn. - Misleading Terminology and Marketing:
Some institutions used terms such as “bank”, “banking”, or “bank account”, which risk misleading consumers into believing the firm is a licensed credit institution. Similarly, references suggesting that payment accounts can be used for savings purposes were found to be inaccurate. Payment accounts should be clearly described as transactional tools, not deposit products. Moreover, firms must disclose that while client funds are safeguarded under applicable legislation, they are not covered by the Depositor Compensation Scheme.
Next Steps for Firms
The MFSA expects all financial institutions falling under the Regulations to take corrective action, specifically to:
- Ensure strict compliance with the Payment Accounts Regulations and the EU’s Implementing Regulations.
- Conduct a gap analysis to identify and close any compliance gaps.
The Authority signalled its intention to follow up through supervisory interactions, meaning firms should anticipate further scrutiny. It is therefore recommended to review and update website content and marketing materials to avoid misleading terminology, and implement robust processes for maintaining information on the Fees Comparison Tool.
This thematic review underscores the MFSA’s focus on consumer protection and transparency. Institutions should view this as an opportunity to strengthen internal compliance frameworks, enhance client trust, and mitigate regulatory risk.
