IslamicFinance.de

The Islamic Financial Services Board (IFSB) has issued a Working Paper on Financial Consumer Protection in Islamic Finance (WP-03). The objective of consumer protection requires that the regulator takes adequate measures to ensure that the claim made by a financial institution to sell its products and services is sufficiently justified. The Working Paper lists some important findings from behavioural economics on the relevance of financial consumers' information-processing capabilities and cognitive biases in ensuring the effectiveness of consumer protection measures. It also provides a summary of both traditional and new approaches to financial consumer protection.