Mis-selling of financial products is likely to increase unless the industry acts to tackle the consumer knowledge gap in terminology and financial literacy, suggests research by the Institute of Financial Services.
In what the IFS describes as “a major audit” of the British consumer’s financial nous, the study discovered almost eight out of ten (79%) of people did not correctly identify the term ‘APR’ as the interest rate and cost of a loan, even though almost all of those people deem themselves to be confident about their finances. Similarly, this same report revealed three out of ten (29%) did not understand a standing order is best described as regularly paying the same amount of money to someone while 40% of people do not really understand financial products such as mortgages and Isa, while thr...
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