Firms advertising financial products or services must make sure their promotions are fair, clear and do not mislead you. Promotions can be:
• adverts in the media (eg radio, press, television);
• direct mail sent to your home;
• leaflets or posters;
• letters to customers;
• shop window advertising;
• telephone calls;
• teletext;
• emails; and
• websites.
How We can Help
We can help you by comparing most financial products and services in Sri Lanka before you actually buy them– for example if they’re about:
• investments such as:
• bonds or gilts;
• structured products;
• shares/stock in a company;
• units in collective investment schemes;
• endowment plans;
• funeral plan contracts;
• deposit and savings accounts;
• insurance such as:
• household and motor;
• travel;
• payment protection or critical illness;
• private medical insurance; or
• most mortgages;
• home purchase plans (also known as Islamic mortgages);
• sale-and-rent-back schemes; and
• financial advice about any of the above products.
• and many more
What to look for
A promotion can be unfair, unclear or misleading in many ways. You should make sure you understand the product or service being offered and you may want to ask yourself the following questions when looking at financial promotions:
• If the advert is for a specific product, is it clear what the product actually is?
• Does the product claim to be free of charge, when in fact there are charges?
• Are the returns quoted in the headline unrealistic? For instance, the small print might explain that those headline returns or premiums are only available under strictly limited circumstances. Is the required commitment made clear? For instance, the quoted return may only be available if you keep the money invested for six years.
• Is it clear what the penalties are if you withdraw your money early?
• Are there any other drawbacks in the small print?
• What is the risk to your money? Will you get your original investment back, plus some income? Or is there a risk that you will get back less money than you put in?
• Does the advert mention any kind of guarantee? If so, do you understand precisely what is guaranteed?
If you’re not sure you understand the product or service in any way, you might compare the features on rightBETA.com or you might contact the firm to ask it to clarify or ask for more information.
