European Commissioners are to hold a public hearing in June to see how to reduce obstacles that consumers face when buying investment funds.
Brussels this week said only 43% of European households invest in any type of financial product and acknowledged the challenges faced by people in collecting and comparing information about funds and related products
Commissioners also noted that fund costs are “very different” across the EU, even where products are similar, and also noted the average European investor seeks guidance from banks and insurers whose advisers are not independent.
“The Commission will organise a public hearing on 29 June 2018 to exchange views on how to further improve the situation,” an official announcement said.
The EC’s ‘Study on the distribution systems of retail investment products’ comes against the background of the Capital Markets Union action plan, which aims to boost the EU economy, in part by making retail investment easier.
The study – carried out by Deloitte Luxembourg and which also covers investment-driven life insurance and private pensions – spans costs and charges for investing through banks and online; the outcome of advice; and the potential role for fintech.
Better Finance, a consumer body, said the findings drew “a grim picture” by detailing the obstacles retail investors face when seeking financial advice or wanting to buy an investment product.
“The EC study confirms Better Finance’s findings, i.e. that investment products are not bought but sold, and that an average individual investor is not able to differentiate between the benefits and risks of different types of advice,” the group said.
The EC said regulation introduced in recent months, such as the revised Markets in Financial Instruments Directive, should improve the functioning of the markets for retail investors.
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