Many firms are still in the dark regarding new Consumer Duty regulations, according to recent research by Moneyhub.
In its new report ‘FCA Consumer Duty: Business Burden or Golden Opportunity?’, senior decision makers (CEOs, chairmen and board directors) were interviewed on their preparedness ahead of the first Consumer Duty deadline at the end of October.
Alarmingly, over 38% of senior decision makers said they had either limited or no knowledge of the upcoming consumer duty legislation, with many only being alerted to its existence through this survey.
Samantha Seaton, CEO of Moneyhub, said: “There are no excuses left, businesses must ensure they understand their customer completely in order to offer products and services that fit their circumstances throughout the entire duration of their relationship.”
Thankfully, interview data also confirmed that some firms were in the process of getting plans in place ahead of the upcoming deadline.
The research revealed that 22% of firms had projects in place in order to meet the deadline in 2023, and a further 28% are currently developing plans to become compliant.
For many of these firms, technology is believed to be key to Consumer Duty preparedness, as 48% said they plan to or are already investing in technology to develop and deliver more personalised and targeted communications.
Additionally, 41% also have plans to invest in technology in order to access customer data and insights.
These new FCA’s regulations come about in order to ensure that customers receive communications from financial services firms that they understand and are being offered products that meet the individual’s need at the point of sale and throughout the entire product lifecycle, offering fair value and providing support when they need it.
Seaton added: “Open Finance truly holds the key for firms to meet Consumer Duty.
“But to see Open Finance’s role as solely a solution to a problem is a mistake. It is also an opportunity.
“By better understanding your customer, it means you can offer super relevant, appropriate products and services, and ultimately create stronger relationships and build loyalty. “Smart, forward-looking businesses will seize this moment and reap the benefits of truly understanding their customer.”
