Every industry has its jargon. Financial services has more than most, and it matters more, because the people reading it are making decisions about their money.
A customer who doesn’t understand a term rarely asks. They guess, they put the letter aside, or they quietly lose a little trust in the organisation that sent it.
Here are some of the most common culprits, and what to say instead.
Words that mean something different to customers
“Excess.” To an insurer, the amount the customer pays towards a claim. To everyone else, too much of something. Try: “the first £250 of any claim, which you pay yourself”.
“Premium.” Customers often hear “expensive” or “better”. Try: “the price of your cover” or simply “your payment”.
“Variable rate.” Accurate, but it doesn’t tell people what they need to know. Try: “a rate that can go up or down, which means your payments can change”.
“Drawdown.” Familiar to pension specialists, baffling to most savers. Try: “taking money from your pension while leaving the rest invested”.
Words that sound evasive
“Subject to status.” Customers read: “we might say no, but we won’t tell you why”. Try: “we’ll check your circumstances before we can confirm”.
“Terms and conditions apply.” Often necessary. But if there’s an important condition, say what it is, next to the offer.
“Market conditions.” Sometimes the real reason. But if it’s used to explain everything, it starts to explain nothing. Say which conditions, and how they affect the customer.
Words that add length but not meaning
“In the event that.” Try: “if”.
“Prior to.” Try: “before”.
“With regard to.” Try: “about”.
“We are writing to inform you that.” Delete it, and start with the thing you’re writing to say.
These look small. But a letter full of them feels formal, slow and slightly defensive, which is the opposite of what most firms want customers to feel.
When jargon is the right choice
Not every technical term should go. Some have precise meanings that matter legally or contractually. Some appear on statements, forms and other documents customers will see.
In those cases, use the term and explain it the first time it appears. “Your annual equivalent rate (AER), which shows what you’d earn in interest over a year.” Then customers recognise the word the next time they meet it.
Why it matters
The Financial Conduct Authority expects communications to be clear, fair and not misleading, and its Consumer Duty asks firms to check that customers understand what they’re told. Plain English isn’t a style preference. It’s increasingly part of how firms are judged.
It’s also simply good business. Customers who understand a product are more likely to choose the right one, less likely to complain and more likely to stay.
A quick test for your own documents
- Pick a letter or product page and underline every term a customer might not know.
- For each one, ask: can I replace it? If not, have I explained it?
- Read the opening line. Does it say what the letter is about?
- Ask someone outside the business to explain the document back to you.
I’ve written for financial organisations including Barclays, Sainsbury’s Bank, Bain Capital, Nebeus and the Islamic Development Bank. See how I help financial services firms or get in touch.