A few different groups in the United States, namely Americans For Financial Reform and the Consumer Financial Protection Bureau, have made recommendations to the entire U.S. banking industry, urging it to provide more translations for the financial products and services it offers, especially loans.
Providing information in several languages benefits banks and consumers. Banks can reach new customers, increasing their profits and encouraging loyalty. And consumers can access information they understand well to make better financial decisions. So what exactly is the reasoning behind these recommendations?
The LEP Factor
In the United States, a person is considered LEP, or Limited English Proficient, if they are over the age of five, and self-identify or self-evaluate as speaking English “less than very well.” More than 21 million people fall in this category, but most financial institutions in the United States only offer services in English and one or two other languages, with Spanish being the most popular.
For people whose first language is not English, this means that they are left to decipher complex financial conditions in a language they may not have understand well. This has dangerous implications for their financial situations.
There May Be Legal Ramifications
While there is no law stating that banks and other financial institutions must offer explanations of their services in other languages, there are other legal considerations to address. The Fair Housing Act, the Equal Credit Opportunity Act, and even the Civil Rights Act of 1964, were all put in place to protect people from unethical practices in business.
If certain individuals or banks deliberately take advantage of a person’s limited understanding of English in order to enroll them in financial products they don’t actually want or need, that is illegal. So while there’s no legal requirement for translation, there is still legal protection for people whose limited understanding of English may be deliberately used against them.
The Terminology Is Complex
Even for native English speakers, wading into the world of loans, insurance, and many other financial products can be confusing.
Even for native English speakers, wading into the world of loans, insurance, and many other financial products can be confusing. There is a vast collection of very specific terminology for banking and other financial activities, and it can be a real struggle for someone fluent but unfamiliar with finance to really get a solid understanding of what’s going on.
This problem is a much bigger barrier when LEP is part of the equation. If a consumer doesn’t understand exactly what a loan or other financial product’s requirements are they may sign up for a product that doesn’t fit their needs or situation, locking themselves into financial packages the bank can’t actually service. If that happens, a lot of time and expense may be required from both parties to sort out the situation and reach an agreement that is viable for both. Chances are this would require communicating in the customer’s desired language anyway.
Translation is an important strategy for businesses to increase revenue and better serve their customers. And it allows consumers to feel confident about crucial financial decisions.