Oral reply to Parliamentary Question on impact of undesirable marketing tactics for financial products on less financially literate consumers and recourse available
Date: For Parliament Sitting on 3 August 2023
Name and Constituency of Member of Parliament
Mr Desmond Choo, Tampines GRC
To ask the Prime Minister (a) what is the impact of undesirable marketing tactics for financial products, such as ambush style marketing, on less financially literate consumers; and (b) what recourse do consumers have after buying products as a result of such tactics.
Answer by Mr Alvin Tan, Minister of State, Ministry of Trade and Industry and Ministry of Culture, Community and Youth, and Board member of MAS, on behalf of Mr Lawrence Wong, Deputy Prime Minister and Minister for Finance, and Chairman of MAS:
1. MAS expects financial institutions (FIs) and their representatives to conduct their prospecting and marketing activities responsibly and in conducive settings. MAS has set standards of conduct for such activities. For example –
a. Representatives of FIs must disclose their identities upfront and clearly to prospective clients.
b. FIs should monitor the conduct of their representatives at roadshows through site visits and mystery shopping.
c. FIs should conduct call-backs and surveys within the free-look period to check if clients understood the products that they purchased at roadshows.
2. MAS has recently issued a public consultation to strengthen these safeguards by making them mandatory. MAS has also proposed additional new measures such as requiring FIs to –
a. offer consumers additional time of at least 3 to 5 days to consider their decisions;
b. limit the use of gifts to influence consumers’ decision-making; and
c. conduct roadshows and marketing events only in commercial premises, instead of public spaces such as streets and pedestrian areas.
3. A consumer who feels that he has been sold a product through inappropriate means by a representative of an FI should immediately lodge a complaint with the FI. The FI is required by regulation to thoroughly investigate the matter. Where the representative has been found to have mis-sold a product, the FI will offer redress. Should the consumer remain dissatisfied with the FI’s response, he can approach the Financial Industry Disputes Resolution Centre (FIDReC) for assistance. FIDReC’s mediation and adjudication services provide consumers with an accessible and affordable avenue to resolve disputes with FIs.