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Customer Loyalty Packages Make It Difficult to Compare Financial Services
Study in Swedish available

Consumer Law - The Finnish Consumer Ombudman's Newsletter 2/2006
Customer loyalty and benefit programmes are used in more and more services. The Consumer Agency has regarded connecting them to credit and basic banking services as a special problem. As a result of different customer packages it is even more difficult for consumers to determine what services include and how much they cost.

Possibilities to compare different financial services and take advantage of competition are also weakened.

The Nordic Council of Ministers recently studied the transparency of the Nordic financial sector and consumers' mobility and found that nearly 80% of the financial institutions in the survey had some type of customer loyalty or benefit programme. According to the study it is likely that the evaluation of customer relationships and credit ratings will spread and the content of customer loyalty packages will become more individualized.

The Consumer Agency believes that this development should be curbed. One means could be requiring financial institutions to inform their customers of the amount they have paid for basic banking services. This information would help consumers get a better idea of the price of services and would encourage them to look at other options.

The Consumer Agency will focus special attention on customer loyalty programmes in different fields in 2006.

ID: 37211
Author(s): iff
Publication date: 01/04/06

Current Issues of Consumer Law (Finland)

The study Mobiliteten i den nordiske finansielle sektor is available here

Created: 12/04/06. Last changed: 17/04/06.
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