A credit union is campaigning for clearer home loan rate advertising from lenders, saying very few Australian know how to correctly interpret ‘bank advertisements’ financial content.

Consumer research by People’s Choice Credit Union showed 70.4% out of 1520 people surveyed thought bank adverts were ‘confusing’ and 64.7% believed they were ‘clear’.

Only a third of the people (33.1%) thought the adverts were ‘honest’ and just 26.4% believed they were ‘clear’.

The results were similar regardless of whether respondents spoke English as a first language or not.

The survey participants’ confusion was confirmed when they were asked to compare home loan advertisements and select which offered the best deal.

There were three pairs of adverts, which each showing a ‘nominal’ interest rate and a ‘comparison’ interest rate.

Only 12.6 % of respondents correctly selected the best deal in each of the three scenarios. People’s Choice managing director Peter Evers said banks must change the way they advertise to make sure consumers understand what the best deal is – which will put lenders under more pressure to provide it.

“The financial regulators have laid down the rules which we say we have to advertise this way, but it’s not delivering, it’s not giving people what they need, so we have to think again,” he said.

“Regulation is meant to protect consumers, but right now it’s letting them down.”

John can be contacted on 0749722081 or 0410433919.  or email him at jwhitten@ihl.net.au or net www.ihl.net.au. John Whitten is a credit representative (CRN 399796) of BLASSA Pty Ltd (Australian Credit Licence No 391237