The Benefits of Uniform Checking Account Disclosures: Testing Consumer Understanding

Nov 30, 2015
This brief summarizes the results of a Pew-commissioned experiment that tested the effect of uniform versus dissimilar disclosure formats on participants' ability to compare accounts. Half of the nationally representative sample of adults viewed summary boxes that were uniformly formatted and worded, and the other half received disclosure forms with differing layouts and language. The experiment found that uniform disclosures:
  • Made it easier for participants to compare account terms and conditions.
  • Increased participants' confidence in their understanding of practices and fees.
  • Decreased the time users needed to identify account information.
  • Increased participants' understanding of account fees and practices.
These findings demonstrate the benefit of uniform disclosure for consumers and align with previous Pew research showing that 78 percent of checking account holders say that requiring banks to provide a one-page summary of key information about their accounts' terms, conditions, and fees would be an improvement. Accordingly, Pew urges the Consumer Financial Protection Bureau to mandate clear, concise, and uniform disclosures for checking accounts -- as it has proposed for general purpose reloadable prepaid cards.
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