Understanding Consumer Duty
The Financial Conduct Authority (FCA) has introduced the Consumer Duty to elevate the standard of care that financial services firms provide to their customers
This new regulation mandates firms to prioritize the needs, characteristics, and objectives of their customers in all aspects of their operations, from product design and pricing to customer support and communication. The Consumer Duty aims to ensure that customers receive products and services that are fit for purpose, offer fair value, and deliver good outcomes.
How TURN are helping
At TURN, we are committed to supporting financial services firms in meeting and exceeding the requirement. Our solutions are designed to help you navigate the complexities of this regulation and ensure compliance through comprehensive, data-driven approaches.
Understanding Consumer Duty
Want a greater understanding of the implications of the new Consumer Duty requirements? Find some of our more detailed articles on the subject below:
The financial services landscape is continually evolving, driven by the need to better protect consumers and ensure fair treatment across the industry. One of the most significant recent developments in this space is the introduction of the Consumer Duty by the Financial Conduct Authority (FCA). This regulatory framework is designed to ensure that financial firms act in the best interests of their customers, providing them with products and services that deliver good outcomes.
The FCA’s new Consumer Duty represents a significant shift in regulatory expectations. This Duty introduces a new Consumer Principle, requiring firms to “act to deliver good outcomes for retail customers,” supported by three Cross Cutting Rules and four key outcomes that define the firm-consumer relationship. These measures provide a clear framework for firms, ensuring they understand the standards expected of them, while consumers can expect fair treatment from firms.
The new Consumer Duty emphasises the high standard of care that firms must provide to their clients. This expectation is designed to impact a firm’s culture and behaviours, particularly in terms of governance and decision-making processes.
Key Elements of an Effective Governance Structure
- Policies and Procedures: Establish clear guidelines to direct behaviour.
- Risk Management: Implement systems to identify, assess, and manage risk.
- Accountabilities and Delegations: Define clear responsibilities and document key delegations.
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