A lack of financial literacy and unfamiliarity with digital technologies are key drivers of financial vulnerability and exclusion, Europe’s three financial sector supervisors said in a collective report.
Access to digital channels and digital infrastructure has become a prerequisite for consumers to make use of financial services, the report said, adding that a lack of digital financial skills also makes consumers more prone to be targets of digital scams and fraud.
Good practices
The supervisors for the EU’s banking, investment and pension industry want to support national financial supervisors and other public bodies by encouraging them to consider 12 good practices they have identified to address specific target groups and to increase the reach and effectiveness of financial education initiatives.
The list of good practice recommendations of the three European supervisory authorities - EBA, Eiopa and Esma - includes:
- publish a blacklist of fraudulent providers to help digitally literate consumers properly assess the financial risks arising from financial products and services linked to new technologies, such as crypto assets.
- reach technology-averse consumers not only through digital, but also non-digital channels and teach them how to use digital tools to access financial services safely.
- work closely with teachers to understand their specific educational needs, as well as help them develop and test adequate educational material, so that they can serve as multipliers of students’ financial education.
- package financial education initiatives appropriately to increase their reach, for instance by including entertaining elements, such as games. This can help consumers acquire relevant knowledge as well as some practical experience in handling financial matters, thereby creating a deeper and more appealing learning experience.
- apply search engine optimisation to ensure that national supervisors’ financial education websites appear among the first search results when consumers look for information on specific financial subjects.