OpinionSep 18 2015

Why can’t UK banks follow Australia’s lead?

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Why can’t UK banks follow Australia’s lead?

Anyone who faces consumers can see how their interest plummets when they are handed reams and reams of paper, with endless caveats stating “Past performance is no indication of future returns.”

My mother, a former IT lecturer at a college, informs me while she understands what the adviser tells her in plain and simple English about what is going on with their investment portfolio the paperwork makes her head spin.

She says: “You just keep getting more of it and filing it away without even reading it. They [statements listing units, shares, etc] come every few months and all I do is check the money hasn’t disappeared.”

If the UK regulator and government wants to protect consumers instead of burying them in paperwork then they need to create a regime that engages and encourages them to care and take action to bolster their finances.

Encouragingly a couple of recent reports from the FCA show they do understand what a ‘turn off’ a mountain of paperwork is and that consumers want to be engaged with in a different way.

Providers and advisers have been asked how warnings could be changed to reflect the fact consumers prefer online.

At James Hay’s annual conference yesterday (17 September), Robert DeDominicis, chief executive of platform engine GBST Wealth Management Limited, said SuperStream reforms in Australia in the last 12 months have allowed pension transfers at the click of a button.

When asked would the FCA, which requires those wishing to undertake DB transfers to receive advice, would ever back a similar system in the UK, Mr DeDominicis said “It is a self-directed mechanism. I can’t see why not.”

Regulation in the UK needs to recognise people prefer to deal with issues online – time is too precious to sift through masses of paperwork.

We need rules that allow advisers to confidently conduct meetings over the likes of SKYPE and deliver succinct messages about the state of a client’s finances in a video format.

You know what your clients want. We just now need regulation that makes you confidently able to deliver it to a generation that knows what LOL means but is clueless about what APR stands for.