The ISO Committee on consumer policy (ISO/COPOLCO) is calling for a feasibility study to identify gaps in financial institutions’ disclosure of information to consumers on financial services and products. It is also considering whether new International Standards in this area could close the gaps and lead to better informed decisions by consumers.
The recommendations were formulated at the ISO/COPOLCO workshop, hosted by the National Standardization Agency of Indonesia (BSN) on 26 May 2010 in Bali, on the theme of, “Restoring consumer confidence in global financial services – Can standards help?”
Some 150 representatives from business, industry, consumer organizations from 32 countries around the world, attended the Bali workshop to examine whether International Standards can help achieve consumer protection for aspects of financial services of high priority for consumers.
Even before the most recent economic downturn, financial services were a key concern for consumers by virtue of their pervasiveness: most consumers use some type of financial service. The world financial crisis has since brought consumer protection issues in financial services to the forefront of public attention. More than ever, consumers are questioning existing practices and searching for solutions above and beyond “business as usual.”
The ISO/COPOLCO workshop included speakers from India, Indonesia, Malaysia, and Norway, representing organizations for consumers, the financial sector, government agencies and standards institutes. They covered specific issues such as mobile payment systems in a developing country, and microfinance services for the poor.
In addition, presentations dealt with more general aspects of financial literacy and ethics, and how International Standard can help with the development of universal access to financial services. Perspectives were offered from international and national viewpoints, and from developed and developing countries.
“The theme of the ISO/COPOLCO workshop is very important,” said Dr. Bambang Setiadi, Chairman of BSN and Chair of the ISO Committee on developing country matters (ISO/DEVCO) in his keynote speech. “We are now living in an era of access to financial services, financial literacy and ethics in financial services. It is a very timely issue in current financial management.
“Level of consumer understanding of financial services must be continually improved. It is not easy to understand financial services such as interest payments and rates, and debt management. We need better tools, clearer terms and definitions and defined criteria against which consumers can compare the different financial services in order to make informed choices.”
In the view of many workshop speakers and participants, a wide range of stakeholders, including consumer groups, financial sector, regulators, and other concerned stakeholders, stand to gain from the creation of International Standards for the financial service sector with a view to providing accessible, available, understandable, visible and affordable financial services information for consumers.
“It was most encouraging to see industry, businesses, the consumer organizations and the standards community coming together at this workshop to reach consensus on this important issue, and to look for a cohesive, constructive way forward. We have made a very good start in finding common ground and hope we have come one step closer to considering information disclosure/transparency of financial services,” said Ms. Norma McCormick, Chair of ISO/COPOLCO.