Working to improve the financial well-being of our nation
FCA Consumer Duty –
Fairbanking Foundation report now published
‘Our new Duty sets higher and clearer standards of consumer protection across financial services, and requires firms to put their customers’ needs first.’
(FCA Consumer Duty | FCA)
The Fairbanking Foundation welcomes the FCA’s new Consumer Duty. However, new research commissioned by us, raises questions about whether financial services firms really understand and are listening to what consumers want, and whether they have the cultural bandwidth to ensure the Duty makes a real difference.
We have high hopes that the new Consumer Duty will transform financial services for consumers. But whether it does will be down to how well firms are implementing the new Consumer Duty by considering the needs, characteristics, and objectives of their customers, including those with characteristics of vulnerability, and how they behave, at every stage of the customer journey. As well as acting to deliver good customer outcomes, firms need to decide how they respond to findings that outcomes for consumers could be improved. And whether firms ‘do the right thing’ is strongly influenced by what influences their behaviour.
Consumers will have views on what firms’ decisions should look like and we think it is important that firms’ responses to the new Duty are based on a good understanding of what customers expect and how consumers behave.
Our new research into the FCA Consumer Duty looks at how firms are approaching implementation, what is influencing their behaviour, how far consumer views are being taken into account and what the barriers are to implementation. We asked a representative sample of consumers’ for their views on the kind of action firms should be taking when there are negative outcomes to test how useful such data might be to guide firms’ approaches. We make a range of recommendations to senior leaders and practitioners in firms and the FCA to improve the impact of the Consumer Duty, particularly by focussing on consumer expectations and priorities.
To read the full report Click here Consumer Duty Report
We were delighted work with University College London (UCL) and Warwick Business School on this project which was generously supported by FIS Global.
New research into people's financial situation being adversely impacted by Covid-19
As Britain’s cost of living crisis deepens, our research reveals that many people experiencing money woes for the first time as a result of the economic effects of the pandemic are in danger of making things worse by not getting the crucial financial help and guidance that is available.
Four main themes emerged as enablers and barriers to seeking financial guidance:
- Over-optimism – people with new post-Covid financial difficulties were significantly more optimistic that “their financial difficulties would sort themselves out” and were more inclined to believe that “the future will take care of itself”.
- Weak intention – despite saying they were ‘willing’ to seek help, people who newly had post-Covid financial difficulties were significantly less likely to ‘want’ to do so and had less intention of doing so in the near future.
- Belief in positive consequences – respondents in both groups who said they believed in the effectiveness of obtaining financial guidance were much more likely to seek it. Those who had prior experience of financial difficulties were more likely to have this belief.
- Goal from seeking financial guidance – if participants were not clear on what they wanted to achieve, they were significantly less likely to seek help.
How the Fairbanking Foundation can work with your business:
• Advisory - Advisory services for financial institutions, industry associations and other bodies to encourage the development and improvement of financial products and processes to improve customer experiences and financial well-being.
• Research - We conduct market leading research to better understand what drives financial well-being of the UK public.
• Training - We have developed an accessible, interactive workshop, rooted in behavioural economics and market-leading research.
• The Fairbanking Mark - Was the only financial certification scheme in the UK that UKAS has accredited. We worked with financial institutions to evaluate their products to assess how they enhanced their customers' financial well-being.
For 10 years and counting, The Fairbanking Foundation is proud of supporting organisations to put customer financial well-being at the heart of their propositions.
Whether through our Advisory Services or our market leading research and insights, we can support your efforts in developing and launching products, services and communications that focus on positively improving your customers' financial health.
