Speaking at a recent event, Nisha Arora, director of cross-cutting policy and strategy at the FCA, said she has already seen good practices at work.
But she added that “continuing this momentum will realise more and more benefits to consumers, firms, and the UK as a whole”.
The regulator wants firms to ensure they evidence their work on the Consumer Duty in their annual board report.
It added that those with closed products and services should check they are on track to meet the 31 July 2024 implementation deadline.
Arora said: “The Consumer Duty remains a top priority for the FCA. We will continue our work across all sectors to test firms’ implementation and embedding and will share good practice to support the industry.”
Still work to do
Findings from the regulator’s latest Financial Lives survey revealed that 3.6 million people contacted one of their financial services providers but could not get the information or support they wanted.
The FCA also found that adults with one or more characteristics of vulnerability were more likely to report that customer support services did not help them.
A fifth of those with low financial resilience and a fifth of those with low capability reported that provider communications did not help at all.
Good start
However, the FCA noted that, three months on from the Duty coming into force, good practices have already benefitted consumers.
It pointed to firms simplifying language in the letters they send to customers, as well as reviewing fees with fair value in mind.
Arora added: “This has taken significant effort and has been a real shift in both practice and culture. But the work to embed the Duty has only just begun.
“The Duty isn’t something where you can tick the Consumer Duty box on your to-do list and move on. It’s something that needs to become part of who you are as a firm, your culture, and how you do business, running across your whole organisation from Board to front-line delivery, from product design to communications and customer support.”
What’s next?
The regulator said that firms now need to ensure they are delivering good consumer outcomes. This includes reviewing your implementation plan, and checking you’ve made the changes you set out to make.
In the mortgage sector specifically, the FCA is currently looking at some of the products and services provided in the second charge mortgage market.
It wants to understand if, under the Duty, customers are getting fair value. This includes whether fees are representative of the costs incurred by the brokers and lenders.
