It is also important for employees of a company to have the necessary training to be able to identify potential vulnerabilities and adapt their behaviour and interaction with a customer accordingly.
This is consistent with the four outcomes that seek to improve the financial wellbeing of customers and allow them to meet their financial needs.
Companies should also be ready to provide evidence and have MI in place to demonstrate to the FCA that they are continuously and proactively monitoring and testing the actions that they are taking throughout the customer journey, to deliver good outcomes.
If results of testing show that customers with different needs are experiencing worse outcomes than others, then steps should be taken to rectify this.
Where a business has found that a good outcome has not been achieved for a customer and that harm has been caused as a result, compensation should be offered where appropriate, irrespective of whether that customer has made a complaint.
MI should also be in place to review and evidence to the FCA that products and services are fair value, thus meeting the price and value outcome. Similarly, companies should be looking at how they can demonstrate to the regulator that their communications are flexible, and allow for customer understanding.
Risks: non-compliance
The FCA has confirmed that the duty does not have retrospective effect and should not apply to past actions. It is important to bear in mind that the regulator will be looking at existing and current products and services and where they fall short of compliance with the duty.
Further, it confirmed in PS22/9 that it would not be “attaching a private right of action to any aspect of the duty at this time”.
However, there is industry concern around how the Financial Ombudsman Service will interpret complaints relating to the duty and the nature of any possible claims that will be brought by claimant law firms.
Claimants may issue claims relating to the duty, irrespective of the fact that there is no private right of action, for example, by alleging product mis-selling. Some other possible examples of areas for complaint relate to allegations that information provided to customers has been misleading or incorrect, that a product or service has not been of fair value, or that customers (particularly those with characteristics of vulnerability) have not received a fair outcome.
In a speech made on May 10 2023, Sheldon Mills confirmed that the FCA will “become ever more outcomes-and data-driven”, and “ever more attuned to the needs of consumers”.
