Asian banks score poorly in accountability mechanisms: survey

Across four key areas, the banks scored 3.5/10 on average.

Asian banks scored poorly on engagement and accountability mechanisms (1.3/10), Fair Finance Asia (FFA) found in its latest survey.

Whilst banks scored better on average in financial inclusion (5.2/10) and consumer protection (5.5/10), Asian banks scored 3.5/10 on average across four key areas.

FFA has released its new scorecard, benchmarking policies of 15 banks across Cambodia, Indonesia, Pakistan, the Philippines, and Thailand in four key areas. These areas include financial inclusions, consumer protection, financial literacy and education, and engagement and accountability mechanisms.

FFA, with its national coalitions and research partner Profundo, called on banks to balance inclusion goals with financial literacy and consumer empowerment initiatives, ensuring that clients are informed about their sustainability strategies and financing practices.

Bernadette Victorio, programme lead at FFA, noted that Asian consumers are increasingly expecting transparency and accountability from financial institutions. 

Banks should educate and engage with consumers, empowering them to make smarter financial decisions that align with their values, and enable them to be partners in sustainability, she added.

According to Asim Jaffry, country programme lead at Fair Finance Pakistan, Pakistani banks seem to prioritise profit over purpose, often promoting financial products with limited knowledge of their impacts on individuals and society.

Whilst the assessed Philippine banks scored highest in three areas, they must enhance transparency particularly by disclosing information about financed projects, said Genalyn Aquino-Arcayera, programme manager at Fair Finance Philippines.

In Thai banks, gaps remain in policies to prevent over-indebtedness, and there is an urgent need to strengthen accountability and transparency, said Sarinee Achavanuntakul, head of research at Fair Finance Thailand.