Dwindling consumer confidence in finance companies in the UK has been highlighted by both the Financial Services Authority (FSA) and a global survey by advisory firm CEB.
Martin Wheatley, head of the FSA, told the BBCs Today programme in the wake of the payment protection insurance (PPI) mis-selling furore and the Libor fixing scandal society has lost confidence in banks, in finance, in the whole system; we need to restore that.
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Meanwhile, the Consumer Financial Monitor published by CEB has claimed 47% of 18,000 consumers asked between January 2011 and July 2012 had little or no confidence in banks, accountancy firms and private equity firms, with consumer confidence in the UK the lowest of any of the 24 countries surveyed.
The same number, 47%, believed banks could not keep their money safe.
Only 10% believed finance providers shared consumers values and 11% felt they offered clear and simple policies. Nearly a third, 31%, were dissatisfied by the range and quality of borrowing products.
However, the focus of the survey was on banks and not secured finance providers, or what CEB has referred to as alternative institutional funds, and replicates the findings of the Financial Ombudsman Service that PPI complaints were centred on banks and not the Motor Finance readership.
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By GlobalDataRegulation and PPI
Also asked about the future of finance legislation, Wheatley replied: The question about regulation is whether its always backward-looking, always shutting the door after the horse has bolted, or whether we can get on the front foot. And the message Im giving to people is: Were going to be on the front foot.
In contrast to his toughening stance against those who would manipulate the Libor rate, Wheatley said he did not expect criminal prosecution of those guilty of mis-selling PPI.
Inappropriate conduct is quite a long way short of fraud, he concluded.
richard.brown@vrlfinancialnews.com
