Financial advisers could have a role to play in dismantling barriers preventing products being sold across borders, according to the European Commission.
The Commission has published a Green Paper on creating a stronger European market for consumer financial services which asks whether, and how, products could be sold in multiple member states.
The 29-page document said the Commission wants to make sure consumers across the EU have access to the best deal, regardless of which country the company offering it is based.
| Price Differentiation |
Examples of fragmentation and price differentiation across Europe for which there is “no objective justification” included annual fees charged for a credit card varying from €9.10 (£6.58) in Romania to almost €114 (£82) in Slovakia. Another example it gave was monthly premiums for a comparable non-investment 25-year term life insurance product ranged from €10 (£7.23) a month in Slovakia and €12.40 (£8.96) a month in Spain to £65 (£47) a month in the UK. |
The report said: “Consumers often lack access to information about cross-border offers of financial products; it is therefore difficult for them to shop beyond their home country.
“One way to build consumer awareness, and encourage them to switch to more suitable products, would be to ensure that they have access to channels which allow them to find out about products available from other member states and understand their features.
“Such channels could, for instance, include financial intermediaries, independent comparison websites or internet-based independent financial advice services.”
The paper said the Commission is also looking into increasing the portability of products across the EU.
A consultation on these issues will run until 18 March.
Adviser view
Sebastian Van Mook, a financial adviser with Shropshire-based Abacus Associates, said: “For some clients it is going to be fantastic, for those who are mobile, but for the majority it will just put an extra layer of confusion in the marketplace.”
