11 July 2023
Consumer Duty is a new regulation introduced by the Financial Conduct Authority (FCA), which sets higher and clearer standards of consumer protection across all financial services. Essentially businesses must put their customers' needs first, and those who don’t will be held accountable.
It is a mandatory requirement that all financial services will have this in place by July 2023.
There are four outcomes which we as a business will need to ensure that we deliver as standard:
- Ensuring that our products and services are designed to meet our customers’ needs.
- Ensuring that our customers receive communications that they can understand.
- Ensuring that we always offer fair price and value and that this is continually evaluated.
- Ensuring that our customer receives the support they need, when they need it.
Why has consumer duty been brought in?
The FCA have introduced Consumer Duty to ensure that existing best practice around good outcomes for consumers is applied consistently across the industry. Currently not all financial products and services work well for all consumers, with some companies still presenting information in a way that exploits consumers’ behavioural biases, selling products or services that are not fit for purpose, or providing poor customer support.
These new plans will fundamentally shift the mindset of financial service companies for the benefit of all involved.