My partner in crime, Jennifer Tescher, who runs the Center for Financial Services Innovation, is leading a bold movement to increase quality in consumer finance. High time! Here’s what she has to say:
Given the high level of consumer confusion and distrust, the Center for Financial Services Innovation (CFSI) set out in 2011 to create a higher bar for the financial services industry. With feedback from providers, consumer advocates, policy makers, regulators, and other experts in the financial services marketplace, we created the Compass Principles – a set of guidelines outlining the qualities and features financial institutions should consider, as they create and sell basic financial tools. The Principles are a force for change. They define how the industry can work toward a vision for the future in which financial services are safe and actively contribute to improving people’s lives.
The Principles are comprised of four main guidelines:
- Embrace inclusion by responsibly expanding access;
- Build trust by developing mutually-beneficial products that deliver clear and consistent value;
- Promote success by driving positive consumer behavior through smart design and communication; and
- Create opportunity by providing options for upward mobility.
The Principles aim to inspire a race to the top by encouraging financial services providers to take a proactive role and think creatively about how their products can better serve both their customers and their institutions. The Compass Principles help providers think about how to serve customers in ways that are fair and inclusive. As financial services providers make a “Compass Commitment”—a pledge to proactively and fairly serve their customers and the industry—we will see real examples of products and services that exemplify the Compass Principles. This framework will foster a healthy competition among organizations across the entire landscape to provide safer and more innovative products for their consumers—and we’re looking for those organizations right now. To learn more about the Compass Principles visit www.compassprinciples.com.