By Liezl van Zyl
How banks can up their plain language game
Banks are still missing out on the benefits that come with fully applying plain language principles to their financial communication. Here Liezl van Zyl explains why even basic Ts&Cs are an opportunity to build trust with consumers while also protecting financial institutions from risk.
I’d like to turn the spotlight on banking communication. Not only because we currently have a major retail bank as a client, but also because as business owners we are ourselves clients who regularly receive banking communication.
And here’s the thing, often we find that communication quite frustrating. It’s often verbose, unfriendly, too long, and difficult to understand.
Before Hey Plain Jane existed, when Elizabeth de Stadler and I still had time for a spot of academic writing, we wrote an article[1] that outlined the challenges and opportunities for plain language contracting. Reading it today, I see that when it comes to financial comms in general, and communication in the banking sector in particular, many of these challenges remain.
All financial communication in South Africa is highly regulated. The National Credit Act[2], Treating Customers Fairly[3], and the Code of Banking Practice[4] all require the use of plain language. So, if South African consumers have had the right to clear, understandable information for many years, why are we not seeing more clarity and innovation when it comes to banking terms and conditions?
The challenges
- There is a tension between the principles of information design and the fundamentals of legal practice. Information design (or legal design in this case) requires that the needs of the reader must lie at the heart of the approach. Conversely, the legal team’s job is to protect the bank against risks (or risky consumers). What is often overlooked, however, is that simply writing in plain language can reduce risk.
- Legal documents don’t get the same treatment as marketing documents. Banks spend a great deal of money on marketing communication; identifying the audience and crafting messages that speak to them. Teams are often interdisciplinary and include product teams, sales and marketing teams, and, sometimes, at the end of the process, someone from legal or compliance to check that the right disclosures are included in the ads. Legal documents, on the other hand, are still seen as the sole dominion of attorneys. The style guides and the tone of voice guides that are so painstakingly followed in marketing communications are completely disregarded, because the legal documents are ‘different’.
- Banks are risk-averse by nature. This leads to an overly cautious approach in which banks protect themselves against real and imaginary risks they may have been willing to absorb. It creates an adversarial relationship that undermines trust and transparency in the relationship between bank and client.
- Plain language teams are treated as editors. While it’s great news that many banks now have internal plain language departments, they are often treated as editors who only see the agreements at the end of the process. They are not included in the planning process when new documents are drafted so by the time they get involved they have little power to ask questions or change anything.
- Neither the plain language team, nor the legal or compliance teams are equipped to explain the benefits of plain language and their role in mitigating risk. This means that banks don’t see the value of investing time or money in developing plain language agreements.
- Consumers are not involved in testing the documents. A 2016 study[5] of the three major banks that had plain language departments at that time showed that none of the banks were involving consumers in usability testing of legal documents. While I’m sure that this has changed in the last eight years, I’m also pretty sure that we’re still not testing financial documents enough. Authors ‘test’ the documents on themselves or with colleagues who understand the products and services very well – rendering their tests useless. Again, product testing is common, but testing the comprehensibility of contract terms is rare. I’d love to hear from teams who are testing their documents.
- The term ‘plain language’ is a dangerous misnomer. The language of banking terms should be clear, not plain, and getting there takes more than a change in language. One of the main reasons that agreements are not comprehensible or user-friendly is that it has been difficult to determine what the law means by ‘plain language’. Thankfully, that is no longer the case.
The opportunities
Since the publication of our article in 2017, we’ve discovered a whole community of people who strive for clarity in legal communication – the legal design community. And the plain language ISO standard[6]has been published. This is an extremely useful resource that helps organisations understand plain language requirements and consistently and sustainably produce documents that consumers find relevant, easy to find, easy to understand, and easy to use.
The benefits of plain language terms and conditions are clear.
- For consumers: Improved understanding of contracts and services, increased trust, better financial decision-making.
- For banks: Reduction in disputes and complaints, enhanced customer loyalty, potential for cost savings in legal fees and customer service.
- For regulatory compliance: Meeting the legal obligations for transparency and fairness in communication.
If you’re ready to do more with your banking terms and conditions or you want to learn more about how your bank can benefit from the ISO standard – get in touch. Coffee’s a good start – a plain language project is better.
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[1] De Stadler and Van Zyl, Plain-language contracts: challenges and opportunities (2017) SAMLJ 2017 v 29
[2] National Credit Act 34 of 2005: Section 64 makes provision for the right to information in clear and understandable language.
[3] Treating Customers Fairly states that information provided to a client must be factually correct, in plain language, and must be adequate and appropriate in relation to the level of knowledge of a particular client.
[4] Code of Banking Practice: Clause 2 states that the members of the Banking Association must undertake to give information on products and services in plain language and ensure that all written terms and conditions fairly set out [the consumer’s] rights and responsibilities in plain language.
[5] Cornelius, An appraisal of plain language in the South African Banking sector (2016) Stellenbosch papers in Linguistics 46, 25-50.