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World Consumer Rights Day - Consumers International calls for stronger consumer financial protection and the ECRC will support its efforts within the G20.

The international association of consumer organisations from both advanced and emerging economies calls for: A new permanent international organisation to support work on financial consumer protection; Mandatory financial consumer protection bodies; Clearer contracts, charges and practices; Effective redress and dispute resolution; Measures to promote stability and safety of consumers' deposits and investments; Competition in financial services; Better information design and disclosure; and Universal access to basic financial services.

The ECRC will provide all support it can in renewed efforts to establish good practice, and develop minimum standards and guidelines etc. The ECRC Principles of Responsible Credit are a starting point and the coalition looks forward to any financial and/or institutional support which can help it take forward the agenda it had started 5 years ago.

Below are details of Consumer International’s campaign around World Consumer Rights Day (on 15.3.) and the forthcoming G20 summit this autumn.

http://www.consumersinternational.org/news-and-media/news/2011/03/consumer-groups-demand-fair-financial-services-of-g20-leaders

World Consumer Rights Day 2011: Consumer groups demand fair financial services of G20 leaders

15 Mar 2011

Consumers International has sent a set of international recommendations for strengthening consumer financial protection. Copies of the report were sent on 15 March 2011, World Consumer Rights Day.


Consumers International (CI) has sent a set of international recommendations for strengthening consumer financial protection. Copies of the report were sent to G20 leaders, the Financial Stability Board, the OECD, the World Bank and EU Commissioners.

The recommendations are in response to the G20 commitment to address consumer protection in financial services at the Seoul Summit in November 2010. The G20's commitment followed a campaign led by CI and involving consumer organisations from G20 and non-G20 countries.

 Global consumer movement

Drawing on evidence from CI's worldwide membership, who consistently report poor financial services as one of the top consumer complaints, the recommendations highlight what can be done to support fairness, safety, access and competition in financial services.

Ahead of the launch of the recommendations, Consumers International Director General, Joost Martens said:

"There are as many bank accounts in the world as there are adults, and 150 million new consumers join the market for financial services every year. Yet consumers around the world - in both rich and poor countries - are continuing to get a raw deal from banks and other financial service providers.

"These ground-breaking recommendations are the product of a shared sense of anger within the consumer movement that the rights of financial consumers have been neglected for too long. They provide a clear and comprehensive set of demands for significantly improving financial protection for consumers everywhere."

The recommendations

The report, Safe, fair and competitive markets for financial services: recommendations for the G20 on the enhancement of consumer protection in financial services, calls for:

A new international organisation to support work on financial consumer protection: a permanent international organisation to enable national financial consumer protection bodies to share good practice, issue public alerts, and develop minimum standards and guidelines.

Mandatory financial consumer protection bodies: national regulators with full authority to investigate, halt and remedy violations of consumer protection law, including, where necessary, the right to define specific practices or products as unfair, deceptive or otherwise illegal.

Clearer contracts, charges and practices: regulators should introduce a requirement of comprehensibility, and remove from the market products that do not meet minimum standards. Financial advice to consumers should be separated from sales-based remuneration.

Effective redress and dispute resolution: consumers should have access to adequate individual and collective redress systems. To alleviate the immense strains experienced by existing systems, lessons from disputes should also be synthesised into consumer protection further upstream.

Measures to promote stability and safety of consumers' deposits and investments: including separation of investment and retail banking divisions, bank 'living wills' with guarantees for protecting consumer deposits and reform of insolvency procedures so that the rank of creditors is changed to put depositors at the top.

Competition in financial services: reverse the market concentration, which, accelerated by the financial crisis, has contributed to the creation of institutions that are 'too big to fail'. Remove barriers that discourage consumers from switching accounts.

Better information design and disclosure: financial service providers should be required to take more responsibility for ensuring consumers receive clear, sufficient, reliable, comparable and timely information about financial service products.

Universal access to basic financial services: governments should seek to encourage innovation in safe, effective, low-cost methods for banking inclusion whilst supporting the development of consumer protection.

 

World Consumer Rights Day

The report's launch on 15 March is timed to mark World Consumer Rights Day, when consumer groups across the world will be lobbying their governments to act on fair financial services. 


G20 Campaign

http://www.consumersinternational.org/our-work/financial-services/key-projects/g20-campaign

Consumers for Fair Financial Services is the global campaign to increase consumers' access to stable, fair and competitive financial markets. Consumers International (CI), with its members around the world, is calling for concrete action from international decision-makers to strengthen financial consumer protection.

At its launch, the campaign called on the G20 leaders meeting at the Seoul summit in November 2010 to set up an Experts Group to look into this issue. In a welcome move, the Seoul Action Plan included a request for the Financial Stability Board (FSB) to examine the issue in collaboration with other international organisations, and to report back to the next G20 Summit.

CI has outlined a number of recommendations to the G20 on consumer protection in financial services summarised in Our Activity and in the briefing below.

Although these recommendations are addressed to the G20 they have global relevance and CI is urging all governments to give them their urgent attention.

See the Key Information page to find out more about the issue, and Our Activity to find out what CI has been doing as part of the campaign.

Downloads

CI’s recommendations to the G20: Executive Summary (English)
CI’s recommendations to the G20: Executive Summary (Español)
CI’s recommendations to the G20: Executive Summary (Français)
 

Latest News

World Consumer Rights Day 2011: Consumer groups demand fair financial services of G20 leaders
15 Mar 2011

G20 ministers to develop ‘common principles’ on financial consumer protection
23 Feb 2011

French Finance Minister proposes high-level conference at next G20
14 Feb 2011

Go to news and media

Related press releases

Consumer groups set out demands for fair financial services on global day of action
11 Mar 2011

Consumer groups around the world welcome G20 commitment on financial consumer protection
12 Nov 2010

World’s consumer organisations sign open letter to G20
10 Nov 2010

Go to press releases

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Key information

Consumers for Fair Financial Services

Why financial consumer protection?

Weak financial consumer protection was at the heart of the recent global financial crisis - the uncontrolled growth and subsequent crash of the US subprime mortgage market is a clear example of this. The international response has so far focussed on stabilising financial markets, while consumer concerns have remained largely neglected. But a lack of protection from abusive practices has a significant impact on the wider economy as well as individual consumers.

The experience of CI members points to an ongoing crisis in financial consumer protection which has resulted in a myriad of problems for consumers around the world, from misleading advertising to unfair contract terms and charges. Consumer financial services are complex and exist in a fast changing market which can be challenging for consumers.

The issue is made all the more pressing by the addition of 150 million new consumers of financial services to the global economy each year - many in countries with low levels of financial literacy and traditionally weak consumer protection.

Why international action, and why the G20?

The recent financial crisis started as a national problem that was quickly spread across borders by a global industry and the interdependence of financial markets. The symptoms of poor financial consumer protection are equally contagious and can have far reaching international consequences. The global community now recognises that a co-ordinated response is necessary to return stability to financial markets. The clear link between financial consumer protection and market stability means that strengthening the former is vital to ensuring the latter.

G20 summits bring together the leaders of the world's major advanced and emerging economies and are now the main forum for global economic co-operation. Between them G20 member states cover the vast majority of the world's financial markets. Together they have already agreed on a number of steps such as increasing the minimum capital requirements for banks and agreeing processes to monitor financial institutions that pose a systemic risk to the global economy. The G20 must also bring its considerable influence to bear on addressing financial consumer protection, not only to improve the lives of consumers but to fulfil its mission of achieving long-term economic stability.

What is being done?

The G20 acknowledged the importance of financial consumer protection at their most recent summit in Seoul, after the global consumer movement highlighted the issue through the Cosumers for Fair Financial Services campaign. In the Seoul Action Plan, the Financial Stability Board (FSB) is tasked with working together with other international organisations on investigating ways to advance financial consumer protection, and reporting back to the 2011 G20 summit in France.

Harnessing the considerable experience of its members on these issues, CI has produced a set of comprehensive recommendations on consumer protection in financial services. CI is strongly urging the G20 to adopt these recommendations and support their implementation. Relying on consumer education and information disclosure simply isn't enough - consumers also need products and services that are fair.

Download the presentation below to find out more about the campaign and the key areas in relation to strengthening financial consumer protection. Also see the Resources page for briefings and other materials prepared in the lead up to 2010 G20 summit in Seoul.

Downloads

Consumers for Fair Financial Services campaign presentation (English)

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Consumers for Fair Financial Services

Consumers for Fair Financial Services is the global campaign to increase consumers' access to stable, fair and competitive financial markets. Consumers have been getting a bad deal from financial services for too long. Now CI and its members around the world are demanding meaningful international action.

Our recommendations

To mark World Consumer Rights Day 2011, CI launched a set of recommendations to the G20 on consumer protection in financial services. We want the G20 and other governments to adopt these recommendations and support their implementation.

  • A new international organisation to support work on financial consumer protection: a permanent international organisation to enable national financial consumer protection bodies to share good practice, issue public alerts, and develop minimum standards and guidelines.
  • Mandatory financial consumer protection bodies: national regulators with full authority to investigate, halt and remedy violations of consumer protection law, including, where necessary, the right to define specific practices or products as unfair, deceptive or otherwise illegal.
  • Clearer contracts, charges and practices: regulators should introduce a requirement of comprehensibility, and remove from the market products that do not meet minimum standards. Financial advice to consumers should be separated from sales-based remuneration.
  • Effective redress and dispute resolution: consumers should have access to adequate individual and collective redress systems. To alleviate the immense strains experienced by existing systems, lessons from disputes should also be synthesised into consumer protection further upstream.
  • Measures to promote stability and safety of consumers' deposits and investments: including separation of investment and retail banking divisions, bank 'living wills' with guarantees for protecting consumer deposits, and reform of insolvency procedures so that the rank of creditors is changed to put depositors at the top.
  • Competition in financial services: reverse the market concentration, which, accelerated by the financial crisis, has contributed to the creation of institutions that are 'too big to fail'. Remove barriers that discourage consumers from switching accounts.
  • Better information design and disclosure: financial service providers should be required to take more responsibility for ensuring consumers receive clear, sufficient, reliable, comparable and timely information about financial service products.
  • Universal access to basic financial services: governments should seek to encourage innovation in safe, effective, low-cost methods for banking inclusion whilst supporting the development of consumer protection.

For more information you can find the full policy report on the Resources page, or download the Executive Summary below.

Urging action from the G20 - campaign background

CI launched this campaign in October 2010 to address the shocking lack of financial consumer protection that continues to prevail in most countries - large or small, rich or poor.In the lead up to the Seoul Summit in November 2010, CI called on G20 leaders to set up a new Experts Working Group to make recommendations to address these issues.

The global consumer movement mobilised under CI's co-ordination and threw its weight into persuading national governments around the world to include financial consumer protection on the agenda of the summit. Go to the Resources page for more information on what CI asked of G20 leaders to do and why.

The campaign was very successful and resulted in the G20 leaders instructing the Financial Stability Board (FSB) to report back to the next summit in 2011 on options to advance financial consumer protection.

What next?

CI will continue to harness the wealth of experience that the consumer movement has developed in this area to press for its recommendations to be adopted by the G20, and all governments. The CI World Congress in May 2011 will bring key players from the global consumer movement together to discuss how effective consumer financial protection can build fair and stable markets, and help prevent another global economic crisis.

Downloads

CI’s recommendations to the G20: Executive Summary (English)CI’s recommendations to the G20: Executive Summary (Español)CI’s recommendations to the G20: Executive Summary (Français)

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Programme

Read about the themes and issues covered in the programme on the Congress Information page.

Download a World Congress briefing pdf in English

Consumers International Congress 2011 Programme

Tuesday 3 May


Fringe events*
Registration
Welcoming cocktail reception -
hosted by The Honourable Mrs Rita Lau, JP (Secretary for Commerce and Economic Development, HKSAR)

Wednesday 4 May

Opening Ceremony

Officiating Guest: The Honourable Donald Tsang, GBM - Chief Executive, the Government of the Hong Kong Special Administrative Region

Session 1: Keynote Address
The consumer's role in the future green economy

Session 2: Plenary
The Long View: Sustainable Consumption and the Green Economy

Session 3: Sub-plenary
a:
Should all roads lead to Rio 2012?
b: An introduction to sustainable consumption in Asia Pacific
c: National campaigning on junk food marketing

Session 4: Plenary
Consumer Rights and Corporate Social Responsibility

Session 5: Plenary
Safe and Nutritious Food for All

Session 6: Sub-plenary
a:
Food Safety workshop
b: COPOLCO session - an introduction to the use of standards in providing consumer protection (case study - ISO 10000 customer service)
c: How ISO 26000 on Social Responsibility can be used by consumer groups

Thursday 5 May

Session 7: Keynote address
Financial consumer protection

Session 8: Plenary
Towards Fair Financial Services

Session 9: Sub-plenary
a:
Financial Services campaign workshop
b: Financial literacy and consumer protection
c: Campaign branding and logo design workshop

Session 10: Plenary
Consumers in the Digital World

Session 11: Sub-plenary
a:
Nurturing young consumer advocates
b: IP and copyright - why they are consumer issues
c: Consumer Model Law workshop

Session 12: TED-style lectures
Consumer Rights Today and Tomorrow

Friday 6 May

 

CI General Assembly (CI member organisations only)

Regional meetings

 

*Fringe Events
Fringe events can be arranged by CI member organisations for Tuesday 3 May. There are a limited number of rooms available at the venue for this purpose, so please contact your CI regional office for more details of how you can book your space. Check the fringe events page for confirmation updates.

 



ID: 46846
Publication date: 17/03/11
   
 

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