Canadians and Their Money

understand the most basic banking information provided to the public, thepamphlet replaces with a Latin phrase any word that requires a grade 12 orhigher reading level – a reading level that exceeds the literacy of over 40 percentof the Canadian population.“We urge financial institutions,governments and allorganizations dealing withfinancial information toconsider the specific needs ofpeople with low literacy…it isimperative that attention bepaid to ensuring financialinstitutions use clear language,a concept already endorsedand developed by literacypractitioners.”– ABC Life Literacy CanadaSince 2001, Bank Act regulations have imposed requirements“for clear and straightforward language” that are enforced by theFinancial Consumer Agency of Canada. Despite these regulations,the lack of plain language is still a problem and has become asignificant policy priority in Canada, mainly with regard to creditcards. The Government of Canada recently adopted new regulationsrequiring federally regulated financial institutions to improve thelanguage and presentation of consumer credit card statements bysimplifying definitions, using a legible font size and presenting ratechanges in percentage terms.In our view, these regulations constitute a significant step in the right direction.We believe that similar requirements for clear communication should apply to thecomplete range of financial institutions’ consumer products and services, frombank accounts, mortgages and lines of credit to life and health insurance policiesto non-mainstream products such as payday loans. This should be a regulatorypriority of federal, provincial and territorial governments alike.We are convinced these measures are necessary so that:1.2.3.Comparison shopping and decision making can be made easier andaccessible for more Canadians;Canadians can better understand the terms and conditionsof their financial products and services; andCanadians can benefit from an increased awareness of their rights andresponsibilities as consumers, and be better equipped to exercise those rights.72TASK FORCE ON FINANCIAL LITERACY – IV. Delivery and Promotion