Dos and don'ts when complying with consumer duty

Any material provisions relating to early termination, including exit fees, should also be clearly drawn to customers’ attention, as appropriate, in line with the consumer duty expectations.

In its example of poor practice, the FCA said: "A retail banking customer telephones their bank in good time to transfer money from a savings account into a current account, to avoid going overdrawn. The customer waits on hold for a long time, without good reason, and is unable to get through to an agent to make the transfer, despite trying to do so throughout that day.

"They were also unable to transfer the money online due to an issue with the firm’s online banking service. This results in the customer going overdrawn and incurring charges."

However, in an example of good practice, the regulator said: "An unforeseeable event causes a surge in demand for a firm’s consumer support. The firm has reasonable processes in place to manage unexpected surges in demand and diverts resource to deal with this, prioritising the most urgent and significant requests.

"This means that some customers will experience a delay. The firm posts a prominent notice on its website and social media to inform customers of the situation, as well as a message when customers first contact its helpline. It sets out a process for customers to escalate urgent issues.

"In this example, the firm has acted reasonably to avoid causing harm to customers and acted in a way that is consistent with the consumer support standards."

Communication channels 

The FCA said communications should be effective regardless of the channel of communication used – whether face-to-face in branch, on the telephone or online. 

Digital communications should be compatible with different mediums, for example computers, tablets or smartphones.

The regulator said firms should also ensure they meet the FCA’s expectations regarding the provision of different channels of communication, as set out under the consumer support outcome.

The FCA’s example in the guidance said: “A bank identifies where its customers do not have sufficient funds in their accounts to make regular direct debit payments. 

“The bank sends its customers a short, effective communication through its mobile app or via text message – clearly identifying that it is from the bank – to make customers aware, allowing them time to deposit the funds needed to make payments and avoid additional charges. 

“This firm acted in good faith in this scenario and used its communication channels effectively to tailor messages that helped customers avoid foreseeable harm.”

Another good practice example of tailoring communication was that firms should design communications with customers in mind rather than focusing solely on what is most commercially efficient.