Survey reveals shared values
A recent survey commissioned by the Financial Markets Authority (FMA) revealed that most New Zealanders agree on what constitutes fairness in financial services.
The research involved around 3,000 respondents evaluating 33 hypothetical scenarios related to financial providers.
Consistent views on unfair treatment
The study showed that 26 out of 29 “unfair risk scenarios” were widely perceived as unfair by respondents, while the four “neutral scenarios” were deemed fair.
For instance, 86% of respondents found it unfair that a bank took over a year to repay a client who had been overcharged.
Conversely, 63% felt it was fair that a client’s investment fund had lower fees due to less intensive management.
Understanding fairness in financial services
FMA’s purpose includes promoting fair, efficient, and transparent financial markets.
“With fairness in financial services at the heart of our purpose and mandate, we wanted to test the hypothesis on whether there is a reasonable consensus on what constitutes fairness in practice,” said Stuart Johnson (pictured above), FMA chief economist.
Key findings on fair treatment
- 81% believe everyone should have equal opportunities in life.
- 72% expect fair treatment from their financial service provider.
- 69% feel they receive fair treatment from their KiwiSaver provider.
- 63% believe they receive fair treatment from their bank.
- 57% feel fairly treated by their insurance provider.
Implications for financial institutions
The FMA research offers valuable insights for financial institutions, especially those preparing for the Financial Markets (Conduct of Institutions) Amendment Act 2022 (CoFI), which mandates fair treatment of consumers starting March 2025.
“We hope this research is a helpful conversation starter and we encourage providers to read the findings and provide us with feedback,” Johnson said.
Download the Understanding fairness in financial services research report here.
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