Position Paper on the Retail Investment Strategy

30 May 2022

Position paper

To ensure that European citizens can safely invest in capital markets, both online and offline, improvements are needed to enhance the EU retail investor protection framework.

Retail investors today are facing new challenges and risks, from rapid digitalisation, bad advice, to overly unnecessarily complex financial products and greenwashing. The Retail Investment Strategy needs to tackle these developments head on.

Finance Watch recommends:

  • Streamlined online and offline consumer disclosures and improved presentation, as well as specified timing for provision of pre-contractual information;
  • Robust and more detailed rules on digital advertising for retail investment products, including on social media;
  • Rules providing consumer protection for online tools and interfaces, such as robo-advice and automated decision-making tools;
  • An outright ban of the payment/receipt of all inducements across the EU in relation to the provision of retail investment advice;
  • Basic option products as the default offer, not unnecessarily complex retail investment products;
  • Improved suitability and appropriateness assessment rules for all distributors of investment products;
  • Reliable and comparable sustainability-related disclosures and proper consideration of sustainability preferences in suitability assessments.

Read our paper below.