Opening remarks by Judith Robertson, Commissioner, Financial Consumer Agency of Canada, for the ABLE Fall Virtual Series 

November 23, 2021

Virtual event, Ottawa, Ontario

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Let me begin by acknowledging that I am speaking to you from the traditional, unceded territory of the Algonquin Anishnaabeg People.

As many of you know, the mandate of the Financial Consumer Agency of Canada — or FCAC — is to protect financial consumers.

We do this in two principal ways: first by strengthening the financial literacy of Canadians, and second by supervising the compliance of federally regulated financial institutions with their market conduct obligations.

The pandemic

We know that many Canadians have been struggling with the financial impacts of the pandemic.

FCAC has been monitoring this impact through monthly surveys.

The most recent results provide some insights into the uneven negative impacts on Canadians that can be missed when looking at totals or averages.

For example, despite the reports of increases in savings, many Canadians experienced a worsening debt situation. Our survey results indicate that:  

• About 36% of Canadian households who had debt at the start of the pandemic said it had increased, and
• 60% of those households attribute the increase to the effects COVID-19.

In fact, about half of Canadian households reported a negative financial impact, usually as a result of reduced hours, layoffs or permanent job losses.

National Financial Literacy Strategy

So, as we look forward to this new world it is essential that we all adapt our efforts to strengthen the financial literacy of Canadians to reflect this new reality.

A major milestone in this effort is FCAC’s new publication of a renewed National Financial Literacy Strategy last July.

This is a five-year plan that builds on the foundation of the first National Strategy, released in 2015.

The first strategy was a call to action for individual Canadians to invest in their personal financial literacy.

The strategy increased awareness and has made a meaningful difference in the lives of so many Canadians.

We owe a debt to those of you who have worked tirelessly alongside FCAC to lay that foundation.

And when it came time to renew the strategy, our consultations with organizations like yours across Canada were instrumental in helping us learn from past experiences and gather new insights.

These include the digital transformation of banking services and products, and the emergence of new technologies that create both opportunities and risks for consumers.

You have helped us to reflect on how Canadians are coping in an increasingly complex, digital world and in response to the financial challenges of the pandemic.

The financial marketplace is evolving rapidly, as are the needs and expectations of financial consumers.

The infographic shown here illustrates how, looking forward, we are shifting the emphasis in the renewed strategy to a focus on changes to the financial ecosystem to make it more accessible, inclusive, and effective for Canadians.

The new National Strategy recognizes that individual improvements in financial literacy will only take us so far.

We also need to incorporate the context and wider environment in which Canadians make financial decisions.

The new National Strategy supports a vision where Canadians can build financial resilience in an increasingly digital world and creates a framework for us to all work together in a nationally coordinated approach.

The financial ecosystem includes us all, the financial industry, governments and regulators, community organizations and many other key players.

All these groups will play an important role in the National Strategy to improve the financial ecosystem to enable greater financial resilience for Canadians.

The focus on financial resilience in the National Strategy will help the most vulnerable and benefit all Canadians.

The new National Strategy outlines 3 high-level areas of focus. 

The first is to reduce barriers; the second to catalyze positive actions and the third is to find ways to enable consumers to build the skills, capacity and behaviours that, when taken all together, will lead to greater financial resilience.

Let me elaborate.  First reducing the barriers

Reduce barriers

We all know that there are many barriers that prevent people from accessing, understanding, and using appropriate financial products, and services.

The National Strategy identifies 3 priorities related to the most important of these barriers.

First, we need to communicate in ways people understand as we know that most financial information is presented in a way that is actually a barrier to understanding.

Second, we need to build and deliver products and services that reflect the real diversity of consumers and their needs. We know that one size does not fit all so we need to test with specific population segments to ensure that a feature for one is not a barrier for another.

And third, we know that the trend towards the digitization of financial services has been accelerated by the pandemic, so we need to reduce any barriers to access through the increased support of broad digital access and especially digital literacy.

Catalyze action

The second broad area of focus in the National Strategy is to catalyze the actions that will help Canadians achieve positive financial outcomes and address the persistent biases and misunderstandings that exist about how to assist people with financial challenges.

The 3 priorities we have identified for catalyzing actions include:

• enhancing access to trustworthy and affordable financial advice, because  we know that everyone needs the benefit of expert knowledge from time-to-time and most Canadians do not know where or how to find this. 
• second, by using behavioural design and insights to simplify and guide appropriate financial decisions, and 
• third, by strengthening the consumer protection measures in legislation and  practice so regulations can keep pace with the innovations in the financial sector.

5 key consumer building blocks

The last area of focus in the National Strategy is for the financial ecosystem to find ways to help Canadians develop the skills, capacity, and behaviours that we have learned are the building blocks to financial resilience.

Our research shows that these building blocks are relevant for everyone in society, regardless of income, personal context, or circumstance.

They include the skills to navigate the financial marketplace, the capacity to build just-in-time financial knowledge and the confidence and the ability to manage expenses, debt and savings.

I know that’s a lot to digest, but these are just a few of the highlights of the strategy. It is ambitious and aspirational.

But it is also grounded in sound research and emphasizes evidence-based and outcome-driven approaches.

Therefore, I am confident that we can achieve the strategy in measurable ways that do lead to improved financial resilience.

Financial Consumer Protection Framework

And, although we only published the new National Strategy in July, I am happy to report that we have already achieved an important milestone in strengthening consumer protection, which is one of the priorities of the strategy.

In August the supporting regulations to the Financial Consumer Protection Framework of the Bank Act were published and that will bring this important legislation into force next June.

The Financial Consumer Protection Framework is about further empowering and protecting consumers and includes over 60 new provisions.

This is great news for Canadians and represents the culmination of many years of hard work by FCAC and the federal government for the advancement of consumer protection.

I am proud of the role that FCAC played in this positive development.

Conclusion

My challenge to my own agency, to you and to all our partners in the financial literacy ecosystem is this: let’s work together on this National Strategy to produce better outcomes for consumers.

Our collective work on financial literacy is more important than ever.

I hope you agree that this is an exciting time to be part of the financial education community.

We all have an important role to play. 

Together, we can make change that counts!