The Financial Conduct Authority has set out plans to streamline its guidelines and lean extra closely on its wide-ranging Consumer Duty tips.
The City watchdog says: “We are counting on the Duty as a lot as attainable relatively than creating new prescriptive guidelines.
“So, embedding the Duty nicely throughout sectors is vital as it is going to assist be sure that customers are supported and can assist keep away from the necessity for future prescriptive regulation.”
The Consumer Duty, launched in July 2023, covers the entire of the UK’s 60,000 regulated monetary companies, together with the mortgage trade’s roughly 100 lenders and 18,000 brokers and dealer companies.
The FCA says: “We recognise completely different companies face completely different challenges. We need companies to take an method that’s proportionate to their measurement and to the actions they undertake. “Where acceptable, we’ll set out completely different approaches smaller companies may take.
The regulator has set out 4 precedence areas for assessment of the Consumer Duty over the course of this 12 months and 2026.
These areas cowl:
Review of services final result — How companies are designing services to meet buyer wants, together with these with traits of vulnerability
Review of companies’ approaches to outcomes monitoring — How companies are responding to our outcomes monitoring necessities
Review of companies’ buyer journey design — Looking on the design and supply of companies’ buyer journeys to guarantee clients’ wants are met, with a selected concentrate on how companies apply friction all through the journey
Review of the buyer understanding final result — How companies’ communications are serving to customers make knowledgeable choices
Within these areas, the physique mentioned earlier this week, it is going to additionally have a look at the truthful worth of small enterprise present accounts.
It will research: “How small enterprise banking companies’ present accounts are complying with the worth and worth, and shopper understanding outcomes.
“We’re reviewing responses and intention to feed again to companies concerned by the top of 2025.”
The regulator provides that it desires “to perceive how companies are enhancing shopper outcomes, we intend to perform a handful of multi-firm initiatives to have a look at how the Duty is being embedded throughout sectors.
“We might ask for information, however solely after we want it. And we’ll provide suggestions the place companies need assistance with implementation.”
Last month, the regulator set out plans to cut back three areas information reporting, which it says will profit 11,000 retail dealer companies.
The FCA, like all monetary watchdogs, have been beneath stress to cut pink tape following a Mansion House speech by Chancellor Rachel Reeves final November, the place she mentioned that easing regulatory burdens on companies was an crucial to increase UK progress.
