Zadra : informés, les consommateurs feront de meilleurs choix[en] 

Do you think the current crisis could have been averted if US customers had better education on financial issues?

American consumers bought mortgages which they were unable to pay back. Everybody knows this. They took on too much debt. If your instalments are double your monthly income, I think it is easy to understand that something is wrong. I do not think that requires education. It is just common sense.

What is more important in increasing consumer awareness of financial issues: education or information provided by banks?

Financial education is about providing consumers with the tools to understand the information provided by the market. The market provides a lot of information but consumers are not always able to use it. 

Consumer organisations stress the importance of financial education but tend to focus on information to prevent financial mistakes. Consumers cannot be finance professionals but banks must act responsbily when selling their products to customers. Do you agree?

We think that improving the way financial information is presented is only as useful as the person who receives it is able to use it. Our interest is that people understand what we say to them. We do not want to turn consumers into financial professionals, but make them able to distinguish financial products and services as they do in other sectors, for example with food. Consumers are not dieticians, but they know how to use information on food products. They know that vegetables are better than fat, and they make their choices accordingly. We have to reach similar levels in finance too.

What must be done to achieve this?

We have to start educating youth first to make them understand their financial needs and problems, such as savings and savings investments, to prevent them turning 40 without ever having heard anything. Then it is much more difficult to start to learn.

When can we have better financially educated consumers in Europe? Does the industry suggest a target date?

We are working on it. There are experts studying the subject. It is not easy to say. In Italy we are developing a project, with the support of the EU institutions, to identify an indicator of financial literacy which in the long term, would allow the phenomenon to be measured. We first need to verify whether the initiatives taken to educate people are fruitful, whether they bring concrete results.

The spread of bank accounts might be such an indicator?

It is definitely an important signal if more people open their own bank accounts. At the moment, many do not request it because they do not realise its importance. They are scared of losing money and they keep holding it under their mattress.

The introduction of SEPA and the spread of electronic payments might be useful to make consumers more comfortable with finance.

It is definitely a positive evolution, because it increases the number of financial services available and therefore triggers more education to use them. Financial education means making people forget their fear of using financial services.