Profitable and sustainable savings

Green finance is the new trademark of the financial centre. The criteria are still being defined and the European Commission is trying to clean up the mess so that investors, large and small, are properly informed. Ekkehart Schmidt is in charge of public relations at Etika, a non-profit association founded in 1996 to promote alternative finance and to reflect on the development of ethical money.

Lëtzebuerger Journal: How to see clearly through the various offers of banks, brokers or insurers?

Ekkehart Schmidt: It’s quite difficult because there is a great lack of transparency, possibly caused by a lack of competition on the price and quality of products in Luxembourg. The local market is too small compared to our neighbours where these players invest a lot in marketing. It also completely lacks overviews of external and independent institutions such as the ‘Fair Finance Guide’. Clients have to do independent research and their judgement depends on third party advice or their bank adviser, who follow personal interests. Since 2018 there are regulations such as the European Directive MiFID 2 (Markets in Financial Instruments Directive), which aims at strengthening the protection of investors against financial institutions as well as the transparency of markets and transactions. But it is still not enough.