Valdis Dombrovskis – Photo EC
(BRUSSELS) – The EU Commission announced an action plan Thursday to open up Europe’s market in financial products such as insurance, pensions, loans, and current or savings accounts to the benefit of consumers.
The plan, which sets out ways to provide European consumers with greater choice and better access to financial services across the EU, has a focus on technology and the provision of innovative online services to drive progress towards a more integrated European market for financial services.
Accordingly, the EU executive is also publishing a consultation on technology and its impact on the European financial services sector (so called ‘FinTech’) to spur the Commission’s work in this area.
European consumers and firms should be able to take full advantage of a true Single Market for financial services, said finance Commissioner Valdis Dombrovskis: “Consumers should have access to the best products available across the EU, not just within their own country. At the same time, we want to explore the full potential of the technology that’s out there. If harnessed well, it has the potential to change for the better the financial industry and the way people access financial services,” he said.
Currently only 7% of consumers currently buy financial services from another EU Member State, and the plan seeks to break down remaining national barrirers.
In a genuine Single Market, the distinction between domestic and foreign providers should no longer matter, says the Commission. All consumers should be able to choose freely from a wide range of financial services available across the EU and get the best value for their money – while at the same time being confident that they are well protected.
The Commission says there are three main strands of further work to move a step closer to a genuine Single Market for financial services:
- Increase consumer trust and empower consumers when buying services at home or from other Member States. Among other things, the Commission wants to make it easier for drivers to take their no-claims bonus (‘bonus-malus’) abroad. It also wants to reduce fees for cross-border transactions involving non-Euro currencies and will be taking steps towards more transparent pricing of car rental insurance.
- Reduce legal and regulatory obstacles affecting businesses when seeking to expand abroad. This will include working on common creditworthiness assessment criteria and facilitating the exchange of data between credit registers.
- Support the development of an innovative digital world which can overcome some of the existing barriers to the Single Market. The Commission will work with the private sector to explore how they could use electronic identification and trust services for checking the identity of customers. It will also monitor the practices of digital providers to decide if rules for selling financial services remotely – such an online or by phone – should be updated.
Consumer financial services action plan - background guide
