# New research indicates confusing bank jargon could be fuelling financial vulnerability Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-08-09 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: New Research Reveals Banks Fail to Support Vulnerable Customers Meta Description: Over half of banking customers feel unsupported, need clarity on finances to avoid financial disaster. Research shows need for improved customer service and URL: https://financedigest.com/new-research-indicates-confusing-bank-jargon-could-be-fuelling-financial-vulnerabilityhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-1085009346-1736813677862-compressed.jpg) # **New research indicates confusing bank jargon could be fuelling financial vulnerability** **Research finds that more than half of banking customers say banks are unsupportive and should be doing more to help them understand their finances: given 1.3m missing household payments this is becoming crucial to address.** Research with 2000 UK adults, released today shows that banking customers are feeling alone and confused about their finances at a time of economic uncertainty for many. The research commissioned by experience services business – Foolproof, a Zensar company, demonstrates the need for the FCA’s Consumer Duty principle which was/will be implemented last/next week. Off the back of this research, Foolproof financial services experts encourage banks and financial providers to consider the term ‘vulnerable [customer’](https://www.financedigest.com/revolutionising-finance-exploring-the-impact-of-omnichannel-insurance-on-customer-experience.html "Revolutionising Finance: Exploring the Impact of Omnichannel Insurance on Customer Experience") carefully and urges them to ensure they are offering services that are clearly worded, informative and supportive. The [firm believes that the combination of lack of financial](https://www.financedigest.com/why-financial-services-firms-are-banking-on-behavioural-biometrics-to-beat-fraud.html "Why financial services firms are banking on behavioural biometrics to beat fraud") comprehension and the continued squeeze on household incomes may see many previously solvent Brits in danger of falling into the ‘vulnerable’ category. The [Consumer Duty rules indicate that firms should equip customers](https://www.financedigest.com/vulnerable-customers-what-the-consumer-duty-rules-mean-for-both-financial-services-and-non-financial-service-operators-and-how-the-rules-could-develop-in-the-coming-years.html "Vulnerable customers; What the Consumer Duty rules mean for both financial services and non-financial service operators and how the rules could develop in the coming years") with “the right information to make effective, timely, and properly informed decisions.” This is one of a few outcomes where banks are perceived to be falling short according to Foolproof’s research which showed: **Perceived lack of support from banks:** [58% of customers](https://www.financedigest.com/nearly-half-of-banking-customers-say-they-are-missing-the-human-connection-in-banking.html "Nearly half of banking customers say they are missing the human connection in banking") are unsure if, or do not feel, that their bank is supportive. This could be related to issues with [customer service](https://www.financedigest.com/acknowledging-the-truth-behind-poor-customer-service.html "Acknowledging the Truth Behind Poor Customer Service"), lack of personalised assistance or inadequate communication. Banks must work to improve their customer support and engagement to [build stronger relationships](https://www.financedigest.com/building-stronger-relationships-with-insurance-companies.html "Building Stronger Relationships With Insurance Companies") with their customers. **Difficulty understanding Terms and Conditions**: 1 in 4 customers find it hard to understand the terms and conditions of their [banking products](https://www.financedigest.com/the-rise-in-embedded-financial-products-is-the-new-norm-of-banking.html "The rise in embedded financial products:  is the new norm of banking?"). This highlights the need for [banks and other financial](https://www.financedigest.com/the-transformative-power-of-technology-in-banking-and-finance.html "The Transformative Power of Technology in Banking and Finance") providers to simplify their T&Cs and use more accessible language to improve transparency and customer comprehension, particularly in relation to big ticket items like loans, mortgages and other credit products. **Lack of clarity in financial language:** 20% of customers do not understand the language used to describe financial [products](https://www.financedigest.com/empowering-personal-finance-the-rise-of-fintech-products.html "Empowering Personal Finance: The Rise of Fintech Products"). [Banks should make an effort to communicate](https://www.financedigest.com/mind-the-education-gap-banks-are-failing-to-effectively-explain-and-communicate-financial-terms.html "Mind the education gap – banks are failing to effectively explain and communicate financial terms") in plain language, avoid jargon, and provide educational resources to help customers better understand financial terminology and what might best serve their needs. **Limited support for [vulnerable](https://www.financedigest.com/limited-support-for-central-bank-digital-currencies-in-global-investment-industry-survey.html "Limited support for central bank digital currencies in global investment industry survey") people:** 18% of customers think banks do not do a job of serving vulnerable, elderly or disabled customers. This indicates an awareness of an underserved group and that more could be done through accessible technologies and designing for all rather than the average experience. **Need for improved financial literacy:** Almost half (44%) of customers believe that [banks could do more to help them understand their money](https://www.financedigest.com/digitisation-of-banking-the-impact-of-digital-money.html "Digitisation of Banking: the impact of digital money") better. This underscores the importance of financial education initiatives by [banks](https://www.financedigest.com/gen-z-finance-banking-on-success-with-personalized-outreach.html "Gen Z & Finance – Banking on success with personalized outreach ") to empower customers with the knowledge and tools to make informed financial decisions and to grow their wealth. **Low customer trust in** [banks to provide help needed:](https://www.financedigest.com/banks-need-better-model-risk-management-heres-how-to-build-a-robust-framework.html "Banks need better model risk management – Here’s how to build a robust framework") 26% of customers believe banks do not care about helping customers come out of debt and believe that it is in their interest not to. This could indicate a brand perception problem and one that needs addressing through clear communication and increased support of vulnerable or indebted customers. Anup Rege, Chief Business Officer, Foolproof, a Zensar company said: “Consumer Duty talks much about protecting [vulnerable customers](https://www.financedigest.com/how-financial-advisers-can-assess-mental-capacity-in-their-vulnerable-customers-in-2022.html "How Financial Advisers Can Assess Mental Capacity In Their Vulnerable Customers In 2022"). However the term vulnerable, with regards to finance, has the danger of being misconstrued as being a smaller group of people than could actually be the case. Anyone seriously worried about their [finances should be considered in this category and financial](https://www.financedigest.com/credit-agricole-beats-estimates-on-insurance-consumer-finance.html "Credit Agricole beats estimates on insurance, consumer finance") services businesses will need to think about what services can be created to support them. The spirit of Consumer Duty is in embodying that lives change and that some financial [products stay](https://www.financedigest.com/the-cancer-supportive-care-products-market-to-stay-innovatively-persistent.html "The Cancer Supportive Care Products Market to stay innovatively persistent") with people across significant changes in their life, and this broader definition is incredibly important in the present moment. Addressing these concerns and aligning with customer [needs will be a priority for banks as Consumer](https://www.financedigest.com/why-challenger-banks-need-to-capture-the-hearts-and-minds-of-todays-consumers-to-become-the-number-one-choice-in-the-retail-banking-sector.html "Why challenger banks need to capture the hearts and minds of today’s consumers to become the number one choice in the retail banking sector") Duty regulations come into effect combined with a financial environment that many aren’t used to living in. By improving transparency, simplifying language, enhancing customer support, and [investing in financial](https://www.financedigest.com/what-green-criteria-sustainable-finance-houses-look-for-when-conducting-due-diligence-and-how-businesses-seeking-to-attract-investment-can-get-their-house-in-order.html "What green criteria sustainable finance houses look for when conducting due diligence, and how businesses seeking to attract investment can get their house in order") literacy programs, banks can build stronger relationships with their customers and provide better, more personalised services that will pay back these short-term investments in the long term many times over. That said, whilst Consumer Duty is welcomed in terms of providing more transparency, it will only really help existing customers. To address the needs of the unbanked population, additional targeted initiatives and policies are required. These may include efforts to improve financial literacy and digital access, expanding access to basic banking services through community banks or credit unions, and fostering the development of more inclusive financial products designed for those with [limited](https://www.financedigest.com/boohoo-says-exposure-to-sterling-plunge-is-limited-finance-chief.html "Boohoo says exposure to sterling plunge is limited – finance chief") resources and financial experience.” --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---