Helping to consumers by withdrawing: the reconstruction of the consumer bumps in finance services
In the course of the last two years finance service power of the worst financial crisis has faced in at least 70 years, and between the middle of September and at the middle of October last year we faced to a potentially catastrophic breakdown confidentially in the bank systems of the world. And this has meant so without fail that a lot has been dedicated by the work of the leadership point FSA to deal with the challenges which the crisis has generated.
There are two precedence many of our lives have controlled.
First, the design and fulfilment of the crisis measures which we took the last autumn and strengthened again earlier this year to protect the validity of the financial system. And the answer to individual problems, like the Icelandic banks, Bradford and Bingley, Dunfermline building society, western Bromwich, and the whole programs of the recapitalization, insures and investment assurance which were put up to make sure that our biggest banks were healthy.
And, secondly, work, have been enclosed in the FSA (United Kingdom) intensely with international colleagues to sketch better regulations and supervision approaches for the future - better precautionary regulation on the capital and liquidity, better accounting to think with foresight, around losses, to lend reforms to improve the efficacy of creditworthiness agencies, and recompense structures. And this work has also enclosed to an end thinking with others the respect between the macro economy policy and finance stability; whether in the future FSA (which can become better the United Kingdom) in discovering of appearing problems, like überschnelles loan growth and house price booms, and in seizing of measures to lean against the wind of the excess - the macro care agenda, as this is known.
Beside this work many people have continued in the FSA, not so much on the validity of enterprise to be put reasonable sustainability by banks and insurance societies, but on how enterprises treat consumer, and whether they deliver to the value of consumers for the money. Our work has been put here on specific appearing problems, as well as on the whole structure by markets.
Thus our work can be seen by order consumer as to have three shores:
We protect consumer, while we protect so in the best way possible that the financial system, and which is healthy rationally, consumers can trust her banks and insurance societies with the minimum danger of the loss. And really in the future is one of the purposes of the precautionary regulation as one minimizes the danger of claims on the taxpayer.
We try to make sure that enterprises lead her business quite to do to suitable stimulus opposite, thus, suitable products with the clear information to consumers selling.
And, of course, the subject of this tutorial, we try to make sure that - as in the best way possible - consumers have the ability, itself is convincing with finance service enterprise to occupy, to buy products which suit for them and to lead her finances actually.
But even if withdrawing a little bit turns out less austere than, appeared possibly some months back, it is clear that it will still cause primary host shaft torture for many people: Unemployment is always a slowly passing tip and will maintain to rise for a long time after the ground in the economic doings. The FSA had estimated, that 1.1 million house holds in the negative cheapness at the end of 2009. Many people will face to austere problems which serve mortgage or personal not secured guilt. And still feel of many unsafe and unsafe her finance views, even if, at the end of the day, they get to avoid austere problems.
Confronted with this lack of clarity consumers must be in the state to trust her finance providers to sell to them good products and to treat quite them, and they must feel swayed that they have the ability themselves to identify good products and to enter for her rights. The problem consists in the fact that enterprise - is trusted not completely and sometimes not earn to be trusted completely - but that consumers are also absent, and know that they, the finance ability are absent to feel authorized.
The finance ability program FSA the mechanism is aimed to a vision by better informed, educated and more persuaded consumers who are in the state to take over bigger responsibility for her finance affairs and to play a more active role at the market for llion people about our websites, publications, and teaching courses and by mediators.
The answer FSA: protecting consumers
But it is important to understand that information, education, management and ability by itself, do not authorize consumer.
Which consumers expect from the financial system:
Consumers must be persuaded that enterprises will protect her interests.
They must be persuaded that the regulator will make sure that happens.
And they must be persuaded that there is protection in the place - things like a nice and transparent complaint process and a balance plan - if things fail.
Therefore, during the last 12 months FSA (United Kingdom) has:
- moves fast to increase compensation, finance security limits for account holders, drastically for consumers increasing;
- taken quick action to make sure that enterprises did not apply unfair terms in trace reader-mortgages which would have allowed to them not to transmit the ground-rent sentence-decrease;
- moves decisively to guarantee that if consumers find out independent council that they receive the best product for them, not simply that which gives the best committee to the adviser;
- started preparing execution actions against enterprise investigated recently with regard to her mortgage remains-practise;
- pushed forward on reforms to the payment protection assurance (PPI) market, for example, on single high-class PPI;
to pledge sent clear signals, payment protection assurance (MPPI) provider which increased the price of the lid unilaterally or reduced the level of the protection on MPPI contracts existing since long time; and
Raised our execution ability and activity - austere and clearing enterprises in record figures to protect our deterrents remain plausible. Our fines are about 514% this year to £ 27.4 ms, and FSA (which announced the United Kingdom) recently measures which can double or treble even the fines for certain criminal offenses.