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Fair Digital Finance Evaluation Framework Fair Digital Finance Evaluation Framework
Fair Digital Finance Evaluation Framework

Principle 5: Support for Financial Well-being

Digital finance products and services are designed to benefit consumers and support consumer financial well-being.

 

Subprinciple: Financial Well-Being Conditions

  • The company has a clear commitment to building financial well-being.
    • Explicit and clearly articulated commitment to build the financial wellness of users included in a meaningful document, not just limited to marketing materials.
    • The company utilizes data-driven metrics to demonstrate that their product or service supports consumer financial
      well-being.
    • The company regularly measures customer’s financial well-being with an established scale such as the CFPB’s scale
      and includes the score as a KPI.
  • Consumers are not subject to inherently unfair terms and conditions.
    • Contractual terms & conditions do not include mandatory arbitration clauses.
    • Contractual terms & conditions do not allow the company to make unilateral changes to the contract.
  • Consumers are not subject to overly aggressive marketing practices.
    • The company does not engage in push marketing or unsolicited offers via digital channels, or obtains active consumer
      consent for such marketing and allows consumers to easily opt-out.
  • Pricing of digital products and services is responsible, delivers value-for-money, and contributes to the long-term financial well-being of consumers.
    • Companies have pricing policies that take into consideration the cost to provide the product and affordability for users.
    • Pricing of products is not excessive.
  • The company takes steps to prevent consumers from becoming over-extended and provides services to manage debt stress. (Where Applicable.)
    • The company assesses a consumer’s repayment capacity and does not offer products that are unaffordable for the
      consumer or would cause financial hardship.
    • Overdraft facilities are only activated with customer consent and with associated fees clearly disclosed.
    • The company has a definition for over-indebtedness and monitors over-indebtedness among its customers.
    • Where automated credit scoring is used, the company monitors portfolio performance for signs of indebtedness and debt stress.
    • The company provides services for customers to manage debt stress, such as via debt consolidation or debt
      restructuring where appropriate.
    • The company provides clear and accessible information to consumers about the risks of overextension where relevant
      including information about the consequences of negative effects to credit scores.

 
Subprinciple: Financial Well-Being Design and Features

  • Digital finance products and services are designed to encourage savings behavior and facilitate savings, including micro-savings and emergency funds. (Where Applicable.)
    • Products include features that allow consumers to set savings goals.
    • Products integrate tools that facilitate saving in small increments, such as round-up saving or moving excess funds from checking to savings account before salary days.
    • Products offer automated savings features, including saving directly from paychecks or at regularly scheduled intervals.
  • Digital financial products and services help consumers protect or build their credit scores. (Where Applicable.)
    • The company reports both positive and negative repayment data to credit bureaus.
    • The company provides information to consumers on monitoring their credit information and managing their credit score.
    • The company provides information that promotes financial education and financial well-being.
    • The company provides clear information about how the offered services work and how they fit in with an individual’s
      larger personal financial strategy.
    • The company provides messaging on wealth building and financial well-being.
  • Digital financial products and services are designed with built-in features that facilitate and incentivize financial well-being.
    • “Smart defaults” automatically default to the best options for consumers.
    • Just-in-time reminders and text alerts are provided regarding upcoming payments, overdraft charges, and other
      time-sensitive responsibilities.
    • Incentives such as better interest rates or other rewards are provided to motivate behaviors such as increasing
      savings or reducing debt.
  • User-friendly tools are provided for consumers to track and manage their own finances and engage in responsible financial behavior.
    • Tools are provided that facilitate setting financial goals and targets.
    • Budgeting tools are offered.
    • Tools are offered to analyze spending.
    • Tools are provided for consumers to set voluntary limits on certain types of spending, such as blocks on spending at
      gambling establishments or cash withdrawal limits.