.jpg)
Financial services providers are fair and professional but have work to do to explain fees and how their products are appropriate, their customers have told the FMA.
The FMA has completed the first of what will become an annual survey of consumers’ experience of conduct. The survey follows the FMA setting out for financial services providers its view of conduct; and publishing a guide for investors describing how they should expect their provider to behave.
The guide, published in February, focused on the FMA’s ‘five Cs for good conduct’: capability, conflict, culture, controls and communication. The questions asked in the consumer survey reflect these factors.
“The changes that have been introduced through the FMA licensing of financial service providers put good conduct at the heart of the industry’s priorities. We have already raised industry and consumer awareness of our view of what good conduct looks like,” said Paul Gregory, FMA Director of External Communications and Investor Capability.
“We thought it was also important to hear direct from consumers what’s actually happening, through our survey. As our guide makes clear, conduct is about what consumers are experiencing.”
“This survey is not a one-off. We’ll share with providers what their customers are telling us about them and, where there are issues, we’ll expect to see them do better,” Gregory said.
Overall more than two thirds of customers said their provider was knowledgeable and the information they provided was easy to understand.
For questions around fairness and professionalism the providers also scored well. However, only half of investors agreed their provider had explained the fees. Just 52% of respondents agreed their provider had helped them to understand why the product was appropriate for them.
One in five investors disagreed with the statement their provider “explained the fees.” These scores were even lower when focusing exclusively on KiwiSaver providers. Among KiwiSaver customers only 46% agreed that fees had been properly explained, and one in four disagreed with that statement.
The survey can be found here
