Firms risk missing commercial opportunities by treating vulnerability as compliance issue, MorganAsh warns
MorganAsh said better customer data could help firms improve decisions, tailor products and contact customers before their circumstances deteriorate.
Financial services firms risk missing commercial opportunities by treating customer vulnerability mainly as a regulatory requirement, MorganAsh has warned.
MorganAsh said better customer data could help firms improve decisions, tailor products and contact customers before their circumstances deteriorate.
Data from Money Advice Trust showed the UK’s 16 million disabled people had annual household spending power of £446bn.
It also found that 75% of disabled consumers believed businesses lost revenue through poor accessibility.
Andrew Gething (pictured), managing director of MorganAsh, said: “We’ve long said that the focus of Consumer Duty and customer vulnerability should be on the carrot and not just the stick.
“All too often the narrative is around what happens if you don’t, rather than the considerable business benefits of why you should.
“Of course, firms do need to meet the requirements of Consumer Duty, but that is only one part of the picture.”
Gething added: “There are significant commercial opportunities and clear competitive advantages in understanding customers properly – and using your insights to make better decisions.
“Whether that means avoiding an unnecessary decline and pivoting to a different product, retaining a customer who might otherwise leave or identifying a need for a new product, better vulnerability data can give firms a much clearer picture of the people they are serving and create real opportunities for greater personalisation.”
Figures from McKinsey put the potential revenue increase from personalisation at about 40%.
Other research identified poor personalisation as a factor in customers switching providers.
MorganAsh said better management of vulnerable customers could benefit firms in debt and credit, insurance, utilities and wealth management.
It plans to present a case study during a webinar covering approvals, product development, Financial Conduct Authority (FCA) enforcement and digital vulnerability management.
He said: “Through the combination of technology being readily available and fantastic guidance – particularly from the likes of the Chartered Insurance Institute (CII), customer vulnerability management doesn’t need to be the burden that firms think it is.
“If a firm can proactively identify a customer’s circumstances, understand them properly and use that information appropriately, they have the ability to improve customer outcomes, while making better commercial decisions too.
“That is a far more valuable proposition than viewing vulnerability as just a compliance cost.”
Related
MorganAsh urges firms to improve evidence of outcomes for vulnerable customers under Consumer Duty
MorganAsh launches calculator to highlight vulnerable customers
Firms risk missing vulnerable customers in financial inclusion push, warns MorganAsh
Firms must digitise vulnerability checks to meet FCA rules, warns MorganAsh
Proactive engagement drives greater vulnerability assessment and disclosure, MorganAsh finds
AI-generated vulnerability claims drive rise in financial services fraud, MorganAsh finds
MorganAsh launches gap analysis service for vulnerability management standards
MorganAsh backs FCA call for firms to take proactive approach to customer vulnerability
MorganAsh identifies 50% of customers as vulnerable across key sectors
MorganAsh enhances MARS for greater customisation and integration
MorganAsh and PayPlan partnership improves support vulnerable customers
