By Martin Banks - 27th January 2010
It is not easy for consumers to understand the risks involved with finance
Gianni Pittella
A parliamentary hearing has heard that school children should be given lessons in financial matters.
Speaking in parliament on Wednesday, professor Umberto Filotto said the recent global crisis in the financial sector highlighted the importance of consumers being given a "sound" financial education.
Filotto, of Tor Vergata University in Rome, said, "Financial education is a vague concept but it means consumers being given very basic and general financial knowledge.
"We can start with this for people of school age. They should be the immediate target group."
The academic was a keynote speaker at a half-day hearing, organised by Visa Europe, on the issue of "financial capability of European consumers".
The conference aims to determine how financial education should be implemented so that consumers gain the most benefit.
Filotto said a distinction should be drawn between "education and training" on financial affairs and "counselling and assistance" for people with money problems.
His comments were echoed by Italian MEP Gianni Pittella, a vice-president of parliament and member of the internal market and consumer affairs committee.
He said that financial literacy for consumers should be of "paramount" importance, adding, "Parliament does what it can to promote best practice but we have got to try an raise the level of education in this field.
"The problem is that in many cases it is not easy for consumers to understand the risks involved with finance, particularly those associated with credit.
"Initiatives taken by the financial industry have proved insufficient and we have not struck the right balance between consumer interests and the large amount of available information."
Another speaker, UK deputy Victoria Ford, a member of the economic and monetary affairs committee, said the public should be given the "skills and tools" necessary to understand the risks involved with financial products on the market.
She said this applies to both the "financially illiterate" as well as the financially "highly-educated".
Ford added, "It also means providing information and programmes in a language that is easy to understand.
"I am not sure that 'euro-speak' is the easiest or best way to communicate this message across."
The conference was told that while the creation of a single market for financial services had brought "huge" opportunities, it was equally important that consumers understand how to get the most value from the increased number of products on offer.
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