MFSA Head Conduct Supervision Sarah Pulis: “Consumers should pause, review and fully understand financial products before committing”

In April 2026, the Malta Financial Services Authority (MFSA) launched a “Know Before You Sign” campaign aimed at enhancing financial literacy and protecting consumers. Business News Malta sat down with Sarah Pulis, Head Conduct Supervision to find out more about the campaign.

Q1. The “Know Before You Sign” campaign launched in April 2026, with particular focus on retirement products and long-term financial commitments. What patterns in consumer behaviour or supervisory casework prompted the MFSA to prioritise this area now?

From our ongoing supervisory engagement and market monitoring, we have identified a recurring pattern whereby some consumers subscribe to financial products or services without fully appreciating the associated features, risks, and long-term implications. In certain instances, it appears that product documentation is not always read or fully understood prior to commitment.  This can result in a misalignment between consumers’ expectations and the product’s actual characteristics and performance, particularly when viewed in the context of its design and intended purpose. We have also observed cases where consumers are encouraged to discontinue or suspend contributions to an existing long-term product—such as a retirement plan—in order to take up a similar product offered by another provider. From a consumer protection perspective, such decisions may have unintended consequences. For example, charges may continue to apply to the original product, potentially affecting accumulated returns, especially in situations where early exit is not feasible due to the nature of the product. A better understanding of product terms and conditions would place consumers in a stronger position to assess such recommendations and to make informed decisions that are aligned with their long-term financial interests. Against this backdrop, the campaign seeks to empower consumers to pause, review, and fully understand the products they are considering, thereby supporting more informed and confident financial decision-making.

Q2. The campaign places equal weight on consumer rights, such as the cooling-off period, and on the discipline of weighing risks and expenses alongside benefits. Where do you see the most significant gaps in consumer awareness today?

One of the key challenges we continue to observe is that, while information on financial products is generally available, it is not always fully understood or actively engaged with by consumers.

In many cases, individuals tend to focus on headline benefits—such as expected returns—without fully considering the underlying risks, costs, and long-term commitments involved. For example, the impact of ongoing fees and charges, particularly in long-term products, is often underestimated, even though it can significantly influence overall outcomes.

We also see gaps in awareness around product suitability and time horizons. Certain products, especially those designed for retirement or long-term savings, come with specific conditions, including limited flexibility or restrictions on early exit. These aspects are not always fully appreciated at the point of decision-making.

Another important dimension is behavioural. Even where clear disclosures are provided, key documents are sometimes not read in full or are not sufficiently understood. This can lead to decisions being made without a complete picture, or based on external influence rather than careful comparison.

Ultimately, the issue is not just about access to information, but about engagement with that information. Strengthening consumer awareness and encouraging individuals to take the time to understand what they are signing up for is essential to ensuring better financial outcomes.

Q3. One specific concern raised is the practice of consumers being encouraged to switch from existing products to new ones, occasionally incurring penalties as a result. What expectations does the MFSA place on licensed entities when recommending a product to a client who already holds something similar?

The MFSA expects that licence holders act fairly, honestly and in accordance with the best interest of their clients.  Accordingly, the starting point is that any recommendation to switch should genuinely benefit the customer—not the licensed entity. If a client already holds a similar product, licensed entities are expected to take a careful and balanced approach. In practice, that means clearly explaining how the new product compares with the existing one, including any costs, penalties, or potential loss of benefits. The client should be able to understand both the advantages and the drawbacks in plain language, so they can make an informed decision.

Ultimately, the emphasis is on transparency, fairness, and putting the client’s interests first.

Q4. Consumer protection sits at the heart of the MFSA's conduct supervision remit, and "Know Before You Sign" represents one strand of a broader agenda. How will the MFSA assess whether the campaign has achieved its intended impact over the coming year?

We will continue monitoring the market very closely via data which we request our licensed entities to submit on a regular basis as well as direct feedback from consumers which we receive on our communication channels.  In addition, we plan to conduct regular consumer surveys to also obtain a better picture of whether consumer understanding in this area has changed.  Furthermore, we will also continue engaging with industry to understand how licensed entities are responding—whether there is a noticeable shift towards clearer communication and more informed conversations with clients.

Ultimately, success is not just about visibility of the campaign, but whether it leads to better outcomes. If more people are making well‑informed choices and avoiding situations where they face unexpected costs or commitments, then we would consider the campaign to be making a meaningful difference.

Q5. For readers who want to learn more about the campaign or seek guidance before signing a financial product, where should they go?

Readers can follow MFSA Social Media pages as well as the MFSA website.  The Campaign is located at Consumer Awareness and Campaigns - MFSA (Consumer Awareness and Campaigns - MFSA)