Greater access to more and better financial products could boost financial well-being of EU households

A more supportive and adaptive regulatory framework across Europe that encompasses digital technology will enable retail financial services customers to better save, spend and invest their money and enhance the EU’s global competitiveness, according to a report out today from the International Regulatory Strategy Group (IRSG), which is co-sponsored by TheCityUK and The City of London Corporation.

The report, ‘Retail financial services: bringing real benefits to Europe’s customers’, considers how new technologies, business models and market entrants are disrupting the way in which retail financial services firms are interacting with their customers. It argues that customers will only fully benefit from these opportunities if policymakers, regulators, Member State Governments and the industry collaborate to build a more modern regulatory system, while ensuring customers are still suitably protected against risk.

Using a bespoke econometric model[1] developed by Accenture (NYSE:CAN), a quantitative analysis of the impact of implementing the report’s 20 detailed recommendations shows that they would benefit the industry’s ability to provide better retail financial services products. It estimates that over a single year, the increase in net financial wealth could average €1,262, or £980, per household.

Mark Hoban, Chairman of the IRSG, said, 

The service offered by the likes of Uber and Amazon, which use technology to meet, and often exceed customer expectations are raising the bar for financial services. By embracing new technology and breaking down barriers between countries across Europe, the Single Market in Retail Financial Services can become even more successful, making it easier for businesses to offer – and customers to choose – products and services without being restricted by national borders.

Increasing the digital sophistication of the EU will also ensure Europe’s businesses develop the skills needed to remain internationally competitive. The challenge is to create and maintain a robust and well-regulated system that maintains customer protection, while allowing for innovation to thrive. The prize for achieving this will be immense and will secure economic growth for generations to come.

The report’s recommendations are focussed on four key areas of development:

  1. Adapting to the changing nature of the financial services system – ensuring the right framework is in place to help the industry take advantage of the opportunities offered by digital and disruptive technologies, market entrants and new business models.
  2. Leveraging the opportunities of digitalisation – as businesses increasingly digitalise, the impact of this – and the greater levels of data produced – require businesses and policymakers to better understand and manage risk.
  3. Completing the Single Market in Retail Financial Services – identifying how to overcome barriers to completion of the Single Market.
  4. Providing better information and products for customers – ensuring customers are provided with the necessary information to better understand their financial products and are equipped with the right tools to plan for their future.


The IRSG report relates directly to the European Commission’s Capital Markets Union Action Plan and its current Retail Financial Services Green Paper. It welcomes the Commission’s focus on the removal of barriers in the Single Market in Retail Financial Services and urges for it to be part of the wider programme to deepen the Single Market in Financial Services more broadly.

Mr Hoban concluded,

Completion of the Single Market in services, capital and in digital should be approached in unison to deliver maximum value: spurring investment and creating and supporting innovation right across the EU. These were key areas called out by the Prime Minister as part of his EU reform deal as being important to securing the long-term competitiveness of the EU. As this report outlines, with the right regulatory framework in place, the opportunities and benefits for customers right across the EU are clear.

[1] The model provides a simplified framework within which relationships among variables can be explored. The analysis should therefore be considered illustrative rather than as definitive quantitative estimations.