I hear a lot from financial companies about the progress they are making in helping their customers become more financially inclusive.
They are very keen to push the message that they are helping customers, not just profiting from them.
Vulnerable people are the lucky ones who get the most benefit from this approach. Companies like to paint a pleasing picture of themselves offering a helping hand to those who need it.
They are like a benevolent uncle, always on hand with some timely advice and – maybe – the odd tenner to help hard-up people through tougher timers. At least that is the picture that companies like to promote.
In practice, we know that profits come first and help comes second for many companies.
You may think that just a cynical view, but it was backed up last week by the Financial Conduct Authority’s latest update on its guidance on the treatment of vulnerable people.
While the regulator said it found many examples of good practice and businesses thinking carefully about their customers and potential vulnerability, that was not true across the board.
It said it “was aware” of cases where vulnerability was not considered by companies.
That is pretty poor in itself, but the FCA also reported that, shockingly, some vulnerable people are being “exploited for gain”.
In other words, some companies when encountering vulnerable people rub their hands together and think: ‘Hooray, a chance to rip someone off.’ That is terrible.
Before we go any further, let’s be clear about what we mean by vulnerable.
The FCA says a vulnerable person could have low resilience, low capability, be suffering a negative life event or having an ongoing health condition that affects their day-to-day activities.
It means people who may not be able to grasp what you consider simple financial concepts, such as pensions or even insurance.
It really does not matter the reason for their vulnerability, it just matters that they need a bit – or sometimes a lot – more help than others.
And it is not just a small number of people. The regulator reckons that just under half of UK adults – around 24m people – have one or more of the characteristics that could make them vulnerable.
Bear that in mind when you think about your clients – almost half of them could be vulnerable, even if only because of a recent event, such as a death in the family.
The FCA has published some detailed research on case studies of people who sought advice about insurance, their bank accounts, loans, overdrafts, critical illness cover, mortgages, and equity release.
I have had a good read of it and it is pleasing that in many cases, consumers were met with understanding responses.
But given these folk were vulnerable, it is astounding how poor the responses from people working in financial services were in some instances.