Financial Services and Consumers: issues and challenges in a context of change

Seminar Series:
Financial services affect all of our lives. The welfare of consumers and nations is strongly affected by financial decisions
large and small; whether that is choosing a mortgage, saving for retirement, borrowing to fund current consumption or
protecting oneself from financial risks. Financial services are largely intangible, high in experience and high in credence
qualities. The implications for consumers are that financial services, particularly complex financial services, are difficult to
grasp mentally, there are limited opportunities for learning due to infrequent interaction with providers, information
asymmetries between consumers and financial services providers require individuals to depend on experts, thereby
creating the need for trust. Risk and uncertainty are inherent to many financial decisions. Not surprisingly, under these
conditions consumers are often poorly informed and susceptible to making poor decisions that not only have significant
personal consequences but also societal consequences.
In the wake of the financial crisis consumer confidence and trust in financial services has been affected. Governments
globally have responded to rebuild the financial services industry. The UK FSA is focused on building a "reformed, fair and
competitive" industry. The seminar series offers a timely opportunity to discuss the issues and challenges facing
consumers in the context of recent and on-going regulatory and policy developments in the financial services industry,
including among other things the establishment of a new Financial Conduct Authority, the Retail Distribution Review, and
pensions auto-enrolment. These developments are aimed at benefitting consumers from fairer treatment, tougher conduct
regulation, better sales practices, access to more financial information and advice, and greater engagement with retirement
saving. However, the full effect of these developments is still to be felt on consumers.
Set against this context the seminar series will provide an opportunity to discuss from various perspectives the issues and
challenges facing consumers in making financial decisions. Understanding the issues and challenges facing consumers in
the context of financial services is both a theoretical and practical task. Drawing on the latest research in financial services
decision-making the seminars will provide an opportunity to discuss and offer insights into the extent to which recent and
planned regulatory and policy developments are expected to achieve the desired aims of enabling consumers to take a
responsible approach to personal finance, the extent to which they are empowering consumers and building capacity, and
the extent to which they are able to support and protect consumers in dealing with decisions that are inherently risky and
uncertain.
The seminar series is designed to explore the interconnections between three main themes: (1) consumer financial literacy,
capacity and experience in making financial decisions, (2) the financial advice and guidance landscape and regulatory
structure supporting and protecting consumer financial decisions, and (3) the role of new media and technology in
supporting and enabling decision-making, including the potential to empower, include or exclude certain groups. The
seminar series will bring together people working in each of these areas to explore the issues and challenges facing
financial services consumers and potential solutions to supporting and protecting consumers.
The central aim of the seminar series is to look holistically at the issues facing financial services consumers in the context
of change with a view to:
-creating new knowledge and building research capacity, particularly for early career researchers;
-exchanging knowledge and fostering collaboration by promoting dialogue and interchange between academics, policy
makers and practitioners;
-disseminating the outputs from the seminar series to the widest audience possible.