In turn, credit institutions provide financing to customers, trusting that they will repay those funds on the terms agreed. Likewise, customers conduct all their business with their banks because they trust them not to sell or reveal any information they have on them as customers. Unfortunately, the bank crisis weakened the general public’s trust in credit institutions. Some strategies followed by certain banks may have made them less customer-centric. I am thinking, for example, of the incentive schemes based, perhaps to excess, on growing business rather than incrementing customer loyalty. In addition, the lack of good practices in the selling of bank products and services has clearly played some part in this loss of trust. One of the most important future challenges we face is to restore and strengthen the industry’s reputation both with investors and customers. The first step to achieve this must be to make simplicity and accuracy a priority in all communications with customers. This includes aspects such as improving the language that is used in relations with customers, refining selling policies and promoting transparency. Allow me, in conclusion, to expand on these points a little further. First, the use of language. The names and descriptions of bank products must not be misleading as to their return and risk characteristics, nor must they be used as misleading advertising tools. Accordingly, terms that offer a false sense of security as to the return or interest that may be obtained must be avoided.
The need to improve the use of language is even more pressing, bearing in mind that the dialogue between banks and their customers is not, shall we say, a dialogue between equals. In this respect, since 2008 both the Banco de España and the National Securities Market Commission (the CNMV) have made great efforts with a view to improving financial knowledge among the general public through the Financial Education Plan. The initiatives taken in this period, to cite just a couple, include the launch of the Finance for All portal (www.finanzasparatodos.com) and the project to include financial education in the school syllabus. A second key aspect of this process is to improve selling practices. Financial institutions have made advances in the service they offer and the resources they dedicate to the monitoring of regulatory compliance. But greater efforts are needed to ensure that bank customers – banks’ main assets – are able to understand the terms of the transactions concerned (clauses of agreements, the cost of services provided, etc.). In this respect, greater zeal is required to ensure that customers receive appropriate precontractual information, and the sale of products to customers whose profile does not fit the product in question must be eradicated. 6/7  Lastly, with regard to transparency, and as I have indicated, banks must be clear about the cost of the services they offer and pass on those costs to bank customers in appropriate fashion. To that end, the Banco de España is stepping up its activities relating to supervision of banking conduct.