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For all the complexity and innovation in today’s financial system, it continues to serve the same purpose as it ever has. Helping families save for a rainy day, and get the lending support they need, helping businesses secure the finance they need to grow, helping both insure themselves against risk. And, at its most basic level, helping consumers access bank and payments systems with confidence and ease.
It is known that faith in the financial sector has taken a huge knock as a result of the financial crisis. At its core, the financial crisis was a crisis of trust – between market participants, but just as importantly, between banks and their customers. But issues of confidence between customers and their banks reaches far beyond the crisis, dating back to endowment mortgage policy mis-selling, and more recently to PPI mis-selling.
Restoring trust is not an easy task. It requires governments, regulators, banks and individuals themselves to take the necessary steps to remedy the failures of the past. That in turn requires regulating the industry in a way that puts the consumer’s interest at the very heart of the financial system. It also means empowering consumers so that they are equipped to engage with the system in an educated and responsible manner. And it means banks themselves taking the lead to heal the wounds of the crisis by demonstrating responsible leadership and supporting families and businesses in need of finance.
It’s absolutely right to expect banks to earn their consumers custom, and it’s right that we empower consumers with the ability and capacity to move their business in confidence. Helping to hold banks to account, but also helping to catalyse greater competition in the sector.
Ensuring that the sector delivers choice that we can understand, products of good quality that meet our needs, and products at the best possible price.
Banks will achieve this by focusing on meeting customers’ needs. Using innovation to serve customers, for example through Barclays’ mobile payment service PingIt. But also maintaining products and services, like cheques, that are important to segments of society.
This will ensure that banks compete for business on the basis of their reputation and the services they provide, putting the consumer’s interest first, and sustaining their vital role as a critical pillar in the economy and society.
Restoring trust in our financial services isn’t something that we’ll achieve overnight. Nor is it something we can achieve by working in isolation. It’s only through constructive cooperation, and committed reform that we will succeed in this ambition. And I look forward to working with you all in the years to come.