|Minister of Commerce and Trade, Sen. Haynesley Benn|
Statement By The Honourable Senator Haynesley Benn, Minister Of Commerce And Trade, On The Occasion Of The ??30th Annual World Consumer Rights Day
Today, March 15th, Barbados joins Consumers International in celebrating the 30th anniversary of World Consumer Rights Day.
Given the current and prolonged global financial crisis, financial services are again in focus this year with the theme being: Our money, our rights – Campaigning for real choice in financial services.??
The right of choice is defined by John F. Kennedy, former President of the United States, as being able "to select from a range of products and services, offered at competitive prices with an assurance of satisfactory quality".?????? When we apply this definition to the financial sector, specifically the banking sector, Consumers International considers that the right of choice is hindered in many countries. The need for change regarding this issue has prompted that body to call for an international campaign for a "real" choice in financial services with emphasis on the global money transfer market.
Each consumer should have the freedom to choose what he/she considers to be the best, most appropriate selection within the scheme of their scenario. In tandem with this, is the ability to possess recourse, which can be legal if necessary, to address any provider whose service is not transparent.????
A lack of transparency, excessive charges, poor services and a general lack of competitive services, can restrict and hold the consumer prisoner within the financial system.??
The trend of opaque pricing makes it difficult for the consumer to compare services for the purpose of identifying benefits and disadvantages.?? This difficulty only serves to frustrate and convince the consumer that it is futile to compare services amongst service providers. This effectively impairs the operation and existence of a rating system.????
Excessive charges for relatively simple transactions are common. In the case of money transfer companies, Consumers International noted that a dual system of charges exists – the consumer is charged a fee for the transfer and incurs an additional "fee" if the sale of foreign currency is involved. This dual system of charging is seldom clearly communicated to the consumer prior to the transaction, resulting in a lack of transparency regarding the true cost of the transaction.??
Asymmetry of information leads to an environment where competition is sub-optimal and meaningful choice is minimised. Consumers International is seeking to bring about a much needed change to this scenario and is encouraging and promoting effective competition. An empowered consumer is one equipped with the appropriate knowledge and tools to make informed decisions.?? Empowerment in this context leads to a competitive and innovative financial market.??
The deficiency in information, as well as varying charges reduces the flexibility of consumers to move their resources between financial institutions. The ability to change or switch institutions without incurring burdensome penalties enhances competition in the financial market.?? The concept of "switching" is deemed unusual to most consumers but this concept is an important way of making such institutions accountable.?? It allows a consumer to activate his or her right of choice where unfair practices are present.
Many of the practices which are highlighted by Consumers International are not unknown to Barbados and are discussed from time to time in the press. It is imperative that consumers in Barbados, like their counterparts in other countries, become more informed and seek to change systems which are disadvantageous to them, not only in relation to financial products but in relation to other goods and services as well.
The Ministry of Commerce and Trade has been involved in the work of Consumers International, and has attended and hosted workshops for both public sector and non-governmental organisations to bring about a greater awareness of the problems facing consumers and possible solutions. My Ministry will continue its work in that regard.
It will also continue to address the broader issues facing consumers through the work of the Office of Public Counsel and the Fair Trading Commission. We are in the process of updating the legislation administered by these agencies to, among other things, strengthen protection for consumers.
As we celebrate the 30th World Consumer Rights Day, Barbadian consumers can be assured that Government is working to ensure their rights are similar to those of consumers in the most advanced countries.