Brussels, 13 April 2023 – The European Association of Co-operative Banks represented by its CEO, Nina Schindler, took part in the event “EU Retail Investment Strategy: Making Financial Markets Work for Consumers” hosted by the S&D Group of the European Parliament. Gathering key representatives from the financial, consumer and public sectors, the debate was the occasion to examine and exchange on the European Commission’s upcoming Retail Investment Strategy, which shall be released in May 2023.
The main purpose of the event was to assess whether the current legislative framework on retail investment markets is working for consumers in the EU, by ensuring that retail investors can access EU capital markets with confidence and trust. More specifically, panellists were asked to debate on the best ways to secure access to unbiased and reliable financial advice for consumers in the European Union. The panel, moderated by Karel Lannoo, Chief Executive of Centre for European Policy Studies, was composed of MEP Jonás Fernández, MEP Eero Heinäluoma (absent), Marcel Haag, Director for Horizontal Policies of DG FISMA/ EC, Hanzo van Beusekom, Member of Executive Board of the Dutch Authority for the Financial Markets, Monique Goyens, Director General of BEUC, and Nina Schindler, Chief Executive Officer at the European Association for Cooperative Banks.
On the option of an inducements ban to improve consumer access to bias-free advice, Nina Schindler declared: “Regarding the need to offer advice to the retail clients, data collected in 2021-2022 during co-operative bank customer surveys suggests that the majority of cooperative banks’ clients prefer face-to-face advice on their investment choices, with numbers as high as 95-100% in countries like Spain and Italy, to 80% in Finland. An inducement ban is likely to cause an advice gap, notably for clients with limited internet access, and/or with low financial literacy, digital savviness and/or income. The ban would leave these customers behind and lock them out of EU capital markets instead of giving the chance to all types of clients to invest in their pensions and to contribute towards a green economy if they want to do so. For cooperative banks, standing for values such as social responsibility and inclusion, the entailed social issue is a major concern.”
Furthermore, Nina Schindler underlined that the discussion must go beyond the one on inducements. To improve the current regulatory framework so that it enables more retail investors to profit from accessing capital markets, it is key to focus also on other aspects, such as: the simplification and harmonisation of transparency requirements for both digital and paper-based communications; the improvement of financial literacy in the EU so that consumers become confident enough to unlock their savings for investment; and finally, alignment with the workstreams in sustainable finance with respect to terminology and disclosures.