On the 30th and 31st of January, the European Commission hosted the 2020 edition of the European Consumer Summit. Commissioner for Justice and Consumers Didier Reynders opened the event with a speech insisting on the importance of consumer confidence, linked to consumer protection, and the effects on GDP. The 230 million households in the EU contribute up to 60% to the EU GDP every year via consumption. A negative consumer experience is therefore not only bad for business but bad for the economy overall.
Among the major challenges and issues to be tackled, Commissioner Reynders insisted on:
- Collective redress, which is still lacking in many countries.
- Climate change and sustainable development: fighting against green washing, empowering consumers to make better and more sustainable consumption choices, boost reparability and fight planned obsolescence.
- Online shopping, which brings new challenges as more and more people buy online, such as counterfeits, scams/fraud, dangerous goods, dynamic pricing and many other technical developments where consumers are vulnerable such as fast online micro loans.
A major theme shared by other panelists is the growing digitalisation of our societies and the emergence of certain issues like control over AI and automated decision making, which could erode trust, and require clear rules to reap the benefits and avoiding the pitfalls.
COFACE Families Europe participated in the workshop on responsible lending and borrowing where the following points were stressed in relation to prevent over-indebtedness of households:
- Harmonizing the definition of creditworthiness;
- Agree on what data is strictly necessary to verify the solvability of a borrower (income, money management capabilities/savings, ongoing financial commitments such as other debt);
- Keeping credit history data under public scrutiny and control (as in the case of Belgium);
- Clarifying the difference between creditworthiness and credit risk profiles and risk assessment;
- Use data which cannot be easily falsified and of high quality (not data from social media for instance);
- Require each member state to issue a leaflet which financial service providers are obliged to give to consumers in case their loan is rejected, with alternatives in seeking financial assistance (social services, social loans…)
COFACE Families Europe will continue to monitor developments in consumer policy and contribute to the EU political agenda in bringing about a better and safer environment for consumers, allowing them to make better choices.