Why does the EU still lack a harmonised retail investment market, and what barriers need to be addressed?
Luděk Niedermayer: Retail and retail investment markets in the EU are very fragmented. Member States clearly prefer keeping their own national rules, and there is a lack of European or Single Market ambition. A combination of different application of common rules, country-specific consumer-protection approaches, and implicit protection of domestic financial institutions that dominate local markets makes cross-border activity costly and unattractive. The absence of large pension funds in most Member States also reduces the EU retail market attractiveness. The key at the start is to change the mindset: promote the Single Market in this area instead of focusing on national ones.
Stéphanie Yon-Courtin: Europe is caught in a vicious circle: Europeans are great savers but poor investors. Too much money sits in bank accounts instead of funding Europe’s own economy, while our savings end up financing growth elsewhere: mainly in the US. This is not just an economic issue; it’s strategic. Europe wants to lead the green transition, digital sovereignty and innovation, which requires capital. Public money alone is no longer enough: private investment must do more of the heavy lifting.
The biggest barrier is fragmentation: we still operate 27 separate markets instead of one European market. Each Member State fears losing control, but the opposite is true: acting together would strengthen everyone. One rulebook, consistent investor protection, easier cross-border access; more competition means better products and lower costs for consumers. This is why the Savings and Investments Union (SIU) matters. It’s about shifting from national silos to a true European market. If we want Europeans to invest in Europe, we must finally give them a market that works at scale.
Where are the most pressing gaps in financial literacy and professional training across Member States?
LN: Data show that European households hold large amounts of savings in bank accounts. This often stems from limited knowledge about alternatives and strong risk aversion. Key gaps include understanding long-term saving, inflation, risk–return dynamics, and diversification. Even the recent period of high inflation, which eroded the value of deposits, has not shifted behaviour. Limited access to more sophisticated investments, low competition, and high fees also play a role. On the supply side, banks remain comfortable with the status quo, and the use of technology to change this balance remains limited.
SYN: Financial literacy is a key piece to completing the SIU puzzle. Knowledge is power : informed consumers are the best defence against mis-selling and abuse. Financial literacy gives people the confidence to manage their money and take control of their financial future. With public pensions under pressure, knowing how to complement them has become essential.
Financial literacy should start at school and continue through major life decisions. For me, two gaps stand out: we must start education earlier in schools, and we must scale what already works by spreading best practices across Europe. This is exactly what I am pushing for through my work on the Retail Investment Strategy.
Delaying climate action is more expensive than acting early. Climate risk is already shown on balance sheets
How can financial professionals ensure they are applying the latest regulatory standards in practice?
LN: The economy and society change rapidly, and the financial sector is both driving innovation and adapting to these developments. Regulation must keep pace and address emerging risks, as seen clearly in anti–money laundering, where I was heavily involved. This is demanding for legislators and even more so for regulated entities, so proportionate rules that support competition are essential. Moving from fragmented national approaches toward a more integrated Single Market with centralised supervision would benefit both firms and consumers. Modern, digital regulation, including tools that track rule changes and effective use of AI should be the preferred way forward.
SYN: Regulation on paper is useless if it doesn’t work in practice. Financial professionals need clear guidance, regular updates and access to training. While firms play a key role, not all have the same resources to keep up. That’s why regulators and public authorities also have the responsibility to step in with practical tools and clear guidance.
How can policymakers and experts collaborate on a long-term strategy for developing the financial education sector?
LN: The European Commission is already active in coordinating dialogue, promoting best practices, and highlighting that financial literacy is becoming an essential life skill. This work should be reinforced by stronger political engagement at both European and national levels, ensuring that decision-makers understand real needs. I believe much can also be done independently by the private sector and non-profit organisations. Regular exchanges with educators, industry specialists, and consumer organisations help align priorities and monitor progress.
SYN: First, stop reinventing the wheel and start scaling what works. Europe has good examples already: Italy teaches finance through TV and civic groups, the Nordic countries start early in schools, and France’s central bank uses card games to make learning finance simple and engaging. The problem isn’t ideas; it’s coordination and no scaling up at EU level.
Second, policymakers can’t do this alone. Education is mostly national, and regulation alone won’t change attitudes. The EU can improve protection and transparency, but real progress happens when schools, employers, financial institutions and civil society move together, as financial literacy is a shared responsibility.
What are the financial implications of delayed versus aggressive climate policy implementation?
LN: Delaying climate policy doesn’t only harm us and future generations; it would also cause substantial costs in the future. The financial risks are clear, as assets tied to high-carbon activities may lose value. The financial sector and mainly the insurance sector will be one of the most visible parts of the economy showing the link between global warming and these processes’ financial cost. Policymakers should be prepared for this in the coming decades, and the risk that some businesses or assets may become hard to insure should not be underestimated.
I don’t think that the EU is on an aggressive path in decarbonisation, as we started this decade with a transparent and predictable process of reducing emissions and lowering our dependency on fossil fuels. Predictability is good for the economy, provides inspiration to others, and ensures our fair contribution to global efforts. Obviously, some adjustments to the policy may be needed and the system can be simplified, but leaving this route would be a mistake and an irresponsible decision.
The European Commission is already active in coordinating dialogue, promoting best practices, and highlighting that financial literacy is becoming an essential life skill
SYN: Delaying climate action is more expensive than acting early. Climate risk is already shown on balance sheets. The insurance sector shows that climate disasters are becoming frequenter and costlier. The main risk is for consumers, which are on the front line. Less than 25% of losses from natural catastrophes are currently insured, leaving households and public budgets increasingly exposed when disaster strikes.
How can institutions prioritise improvements in climate data, modelling, and governance?
LN: Data and continuous assessment of the situation, including technological progress, are essential parts of the process to minimise costs and maximise the benefits of moving toward a more sustainable societal and economic model.
Recently, my key concern has been the growing gap between our data and analytical ability, compared to the perceptions of people and the knowledge of policymakers on the other. This detachment can lead to the prioritisation of policies that may end up being costly for society — especially for future generations.
Therefore, the priority should not only be improving data and models but also transparently presenting the results. This is a fundamental requirement for good policymaking.
SYN: As some countries resist climate action, the challenge has a geopolitical dimension. Institutions can prioritise these issues by leading by example and showing that sustainability and economic strength go along together. Competitiveness and simplification are at the heart of policy making today but shouldn’t be at the expense of climate goals. Institutions must work with stakeholders to establish practicable rules while upholding our values.
In partnership with
EFFAS represents and empowers financial professionals through certifications, continuous training, and flagship events. With 27,000+ holders and 15 National Member Societies, it has shaped European expertise in capital markets, ESG, and reporting since 1962, driving innovation, setting standards, and connecting leaders
Sign up to The Parliament's weekly newsletter
Every Friday our editorial team goes behind the headlines to offer insight and analysis on the key stories driving the EU agenda. Subscribe for free here.