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Categories:Regulation

Consumer panel calls for 'predictable outcome' products

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The Financial Services Consumer Panel says that consumers must have access to straight forward products that deliver clearly defined results to restore trust in financial services in the wake of Payment Protection Insurance misselling.

The panel says that product complexity means many consumers find choosing the right products a stressful and unrewarding experience.

FSCP chair Adam Phillips says: “The Panel wants to see consumers given access to products that do what they say on the tin. Following the banking crisis and the PPI debacle it is crucial to rebuild trust in financial services. We think the ability to buy products that have straightforward objectives and which deliver clearly defined results will help do this.”

Alongside its call the panel released a research paper which says these products should have limited and well understood risks to capital and be purchased through any distribution channel.The panel put forward its suggestion to Government in its submission to the Treasury’s consultation on simple products.

Phillips says: “In the future we look to the development of a range of straightforward outcome products which, depending on the individual consumer, could either be sold via execution only or through an advice process.”

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Readers' comments (5)

  • They are called bank accounts.

    The problem is that everyone thinks that they can make an investment for growth but be immune to stockmarket movements.

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  • This is the broad minded chap I had an email exchange with in July 2010.
    I emailed him to say I had read the FSCP had been complaining about lack of competition (and access) in financial services I pointed out that the RDR (which they support) would actually make this worse for customers. He replied:

    "the Panel supports the work of the industry and the FSA in the development of a simplified advice process within the RDR structure offering a range of simple, safer products. This could meet the needs of consumers in need of advice, but for whom a full independent advice service would be inappropriate or prohibitively expensive."
    In turn I replied:

    "As for your last point about simplified products, we have been there before. Whatever happened to CAT standard products? They have disappeared because they were total failures, as are stakeholder pensions"
    Also:

    "Why should poorer people be priced out of full independent advice? That would be unfair and descriminatory and it is an awful suggestion that they should be forced to make do with a lesser service, as full advice would be inappropriate for them. I am truly shocked by your comment and your intention that they should be treated as second class citizens".

    Needless to say I heard nothing back. What defence could he have? However, IF he is getting paid for still spouting his trash that is a further obscenity and a waste of funds.
    Can't someone from Money Marketing interview this guy and ask him some tough questions?

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  • We shouldn't really waste our time discussing this. These people are on a different planet.

    Sean has said what we all know but what the consumer panel just doesn't or won't understand.

    They are the woolly thinking luvvies that are of the ilk that have allowed the recent riots. They foster an attitude of entitlement and non-responsibility and then seek to blame anyone but themselves when things go awry. Their hearts bleed for everything except common sense and reality. But then what do you expect from a body made up of charity workers and journalists. It is somewhat akin to having the Pedestrians Protection League advising on Formula 1.

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  • How many 'reasearch papers' are now gathering dust? Ron Sandler's in particular.

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  • Evidently, the FSCP has never heard of NS&I products.

    As for the claim that consumers find choosing the right products a stressful and unrewarding experience, the FSCP is also evidently unaware of IFA's.

    In fact, the FSCP appears to have its own head rammed firmly up its own backside.

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