Thursday, 3 November 2016

Warning - be careful when you invest or borrow from us!

Cigarette are laden with them.  Alcoholic drinks too. So are gambling products.  I’m talking of course about health warnings.  

In these industries, companies must add warnings to their adverts.  They must let people know if there is a risk if consumers use their products. 

The same is true for advertising financial products.  

Let’s have a look at some examples.  

The mortgage lender

The most common one you’ll see is:

Your home may be repossessed if you do not keep up repayments on your mortgage.

You might find this with HSBC, Barclays Bank or Halifax. When most people read this, it is often in smaller print.  It is reasonably clear what this means. But could the warning be even clearer? 

If you do not pay your mortgage on time, we may take away your home

If you make the passive voice active, you draw your reader’s attention quicker.  

The short-term lender

If you take the London tube, you might see: 


WARNING: LATE REPAYMENT CAN CAUSE YOU SERIOUS MONEY PROBLEMS. FOR HELP, GO TO MONEYADVICESERVICE.ORG.UK

This looks like a warning on a beer bottle.  You understand it when you read it. Payday lending companies are only too aware of negative press.  So they chosen to be more direct and responsible.

 The property investment company

Like most investments, you may get back less than you put in.

This is simple, clear and direct.  It lets potential investors know: you can lose money as well as gain.  It certainly wouldn't scare away any potential investors.  And it is not hidden away in the terms and conditions. 

CONCLUSION: 

Generally, I believe that the warnings are clear and suitable for their audience. Advertisers need to promote their product and not scare off customers.  

However, warnings are only a small part of the advert. The Financial Conduct Authority’s guidance sums this up well:

Financial advertising and promotions should clearly explain what the product or service is, how it works and how you could benefit from it. 
It must also be clear about the costs involved and whether there are any risks to your money.

Do you have any warnings on financial products? If so, do share them !

WARNING: In this blog, I am only looking at warnings on adverts from a plain language perspective.  This does not mean I am for or against any financial product or company. 

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