Regulation  

Dos and don'ts when complying with consumer duty

“We have seen cases where firms have sent a single and extremely long communication to all customers, covering a range of issues, with customers left to work out which bits of the communication are relevant to them.”

The FCA said: “One customer was unable to read large print and did not know braille. They informed their bank of this and asked to receive communications by email, to allow them to use software to turn the emails into speech. However, the bank continued to send the customer communications on paper, and not by email. 

“The firm did not act reasonably to avoid causing consumer harm or enable them to pursue their financial objectives.”

Vulnerable customers

Last February, the FCA published guidance for vulnerable customers and warned that its focus on the way firms treat vulnerable clients will not be a "one-off exercise".

It predicted that vulnerable customer guidance would apply to approximately 52,000 firms, costing the industry £710mn, with ongoing costs of £450m.

In its example of good practice, the FCA said: “A customer with mental health issues had recently moved their bank account but lost control of their finances and incurred bank charges. They were able to communicate easily and effectively with their bank through online web chat. 

“The bank’s web chat adviser talked things through with the customer, making them feel genuinely understood and supported, and made sure they received appropriate forbearance. 

“This firm’s consumer support is designed to meet the needs of customers, including those with characteristics of vulnerability. It has acted reasonably to avoid causing harm to the consumer and enable them to pursue their financial objectives.”

Another example was of a bank that offers access to British Sign Language interpreters in-branch, via an app on branch tablets, and on its website, enabling customers to deal with their affairs from the comfort of their own home.

“This service increases accessibility and effectively meets the communication needs of certain customer groups. This firm’s consumer support is designed to meet the needs of customers, including those with characteristics of vulnerability.”

“It has acted reasonably to avoid causing harm to customers and enable them to pursue their financial objectives.”

Limited support

The FCA said while it recognised a firm could design a product with a digital-only support offering, there are various factors for firms to consider to ensure it delivers good customer outcomes. 

In particular, it said firms should consider: communicating the support available in line with consumer understanding, ensuring support works effectively, dealing with non-standard issues using exceptions processes, operational resilience and customers with protected characteristics and changing needs.

In its example, it said: “A firm uses an automated telephone system as part of its consumer support. This automated system only provides options to progress with queries regarding a few commonly raised issues. It does not provide a route for customers to seek support regarding other issues.