Remarks by Commissioners Hoekstra and Albuquerque on a Financial Literacy Strategy and a blueprint for Savings and Investments Accounts

Commissioner Albuquerque remarks:

Good morning, ladies and gentlemen and thank you for being here.

At the heart of our vision of the Savings and Investments Union lies a simple but powerful catalyst: empowering citizens to grow their wealth through capital markets.

To that end, today we adopted our Financial Literacy Strategy and our blueprint for Savings and Investments Accounts.

We often hear talk of financial management or planning as if it is a complicated theory reserved for experts. But the truth is, we all live and breathe financial management every single day. Think of the decisions you made in the last 24 hours. You checked your mobile banking app, transferred money, paid a bill? Thats financial management. You stood in the supermarket aisle, weighing the cheaper option against the preferred one? Thats financial management.

So, we are following two parallel paths under the SIU to empower citizens to confidently manage their money and grow their wealth. One path is about the knowledge, and the other is about access. I will take each of these in turn.

Our levels of financial literacy in Europe are too low. Less than one fifth of Europeans are highly financially literate, and this is even worse when we look at the most vulnerable in our society.

Citizens need to budget, navigate financial products and services, avoid fraud, and make crucial long-term choices about debt, savings and retirement, but we do not provide them with these essential skills as part of a basic education or at a later stage. Unfortunately, most of us must learn as we go, often through trial and error, and this leads to stress around money management.

Our Financial Literacy Strategy aims to make money management easier, supporting Europeans at every stage of life: from children learning how money works, to adults managing a budget or preparing for retirement.

Financial education is more than understanding numbers – its a tool which can contribute to financial inclusion and help Europeans ensure financial security and independence. It can empower people to take advantage with confidence of the opportunities offered by financial products and services, including innovative ones.

The strategy is based on four pillars covering

coordination and exchanges of best practices across all Member States;

communication and awareness-raising through EU-wide campaigns and a network of ambassadors to ensure initiatives reach the broadest audience;

securing crucial funding for financial literacy initiatives and research using existing EU channels; and also

monitoring progress and assessing impacts through regular Eurobarometer surveys and the development of effective evaluation tools.

But increased knowledge and understanding is only one part of the equation. The second part of the package adopted today is about creating easier and better access to investing, to enable citizens to put this knowledge to good use.

I often describe saving and investing as two sides of the same coin. Both are essential, yet in Europe, we tend to rely mainly on one. Much of this comes down to know-how, and to access.

The reality is that Europe currently lacks a developed culture of retail investment. For many Europeans, investing seems opaque, complex, and reserved only for those with excess disposable income and savings. This is a misconception that I intend to dismantle. I want every European citizen to know that investing is for the many, not just for the few.

Of course, investing involves risks — but without risk, there can be no return. Over the medium to long term, investing can help protect households savings from inflation, allow them to grow, and enable citizens to reach their financial goals.

And putting money into your investment account should not be any more difficult than making a deposit into your savings account, and it should be possible from as little as ten euro.

This is the entire premise behind our new Blueprint for Savings and Investment Accounts or SIAs. We know these accounts work. They have proven successful in several countries across Europe and beyond. Now, we want that opportunity extended to every single European citizen.

Our blueprint pulls the best practices from the most successful frameworks in Europe and around the world.

It is designed around the principles of simplicity, flexibility of use, and competition between providers.

This means creating a framework that allows a wide array of providers, such as banks and investment firms, including neobrokers, to provide SIAs and encouraging easy transfer and portability between accounts.

Our recommendation includes offering a large scope of investment opportunities while excluding excessively risky and speculative products. And lets be clear: citizens who decide to invest will always have full control over which financial products and economic sectors they choose to invest in.

We also strongly encourage Member States to introduce simple, targeted tax incentives and streamlined tax procedures to make investing as straightforward as possible. My colleague Wopke Hoekstra will come back on those tax aspects shortly.

For Member States that dont yet offer a savings and investment account, this is a ready-made solution.

And for those who already have a system in place, our blueprint offers clear opportunities for improvement and modernisation, ensuring the best possible tools for every person to build their own wealth.

To conclude, through the adoption of the Financial Literacy Strategy and our blueprint for a Savings and Investment Account we are aiming to rise living standards across Europe by enabling Europeans to make more informed financial decisions and invest in themselves and in their future.

We offer concrete solutions to citizens to make their money work better for them.

And our simulations have shown that, under an optimistic scenario, by moving some of their savings into productive investments, citizens could increase the investment in EU assets by more than EUR 1.2 trillion over ten years.

This would make additional sources of financing available to European businesses, thereby driving economic growth and job creation across Europe, as well as European competitiveness.

Therefore, today we continue to deliver on the vision of a true European Savings and Investments Union that better connects savings and investments for the benefit of citizens and the wide economy.

Now, I give the floor to my colleague Wopke Hoekstra.

Thank you.

-------

Commissioner Hoekstra remarks

Good afternoon everybody,

Let me start by thanking Maria Luís for doing the lions share of the work that we have here in front of us today.

We have been talking for years about the Capital Markets Union, but were truly taking a very important step today with the Savings and Investments Union.

For our economy, for our businesses, and clearly first and foremost for our citizens.

And I wanted to thank her very much for all the hard work that has been going into this.

At the heart of this, as she has already eloquently stressed, is our desire to be more competitive. More resilient. More independent.

If you do the numbers, you will find that were the best savers on the planet. But were clearly not the best investors on the planet.

And thats something we seek to change. And its exactly those reasons already mentioned – whether its cultural habits, limited financial literacy, fragmented markets, and fragmented tax approaches that are at the heart of this.

So lets make sure we change that.

These accounts, work in a way like traditional savings accounts but allow citizens to invest in a range of financial instruments—stocks, bonds, funds—through authorised providers such as banks.

They are simple, accessible, and tax-efficient.

First, simplicity in tax compliance: we are suggesting to Member States to cut red tape for investors by shifting filing obligations and tax collection to providers, which would then ensure transparency and ease for users.

Second, tax benefits: when there are tax incentives, however small they may be, they clearly encourage people to take action.

And if you unpack countries who have done that successfully, Sweden, Denmark, Poland and outside the Union, the UK and Japan, thats quite often part of the design.

Were talking about tax credits for example.

Were talking about tax deferrals and giving you the opportunity to wait for paying your taxes.

Were talking about tax exemptions where a government could decide to make sure you have a specific arrangement. Or the application of a flat rate.

All of them designed to make this more attractive and viable for our citizens.

What we do is provide examples of what an effective tax treatment could be.

Weve looked at existing savings accounts and the tax benefits given to them.

And of course, this whole realm is available for Member States – deductions, exemptions, deferrals. All of it is potentially applicable.

Ladies and Gentlemen,

All in all, this is an important step forward.

Good for our capital markets, for peoples financial future.

With interesting tax incentives, people are more encouraged to invest in higher-return investments, which in turn will help us find growth capital and be more competitive.

Thank you.