Six ‘consumer outcomes’ are at the heart of the Financial Conduct Authority’s ‘Treating Customers Fairly’ approach. (You can read more on what Treating Customers Fairly means in our TCF FAQs).
Here we look at how you can embed these outcomes in your financial promotions and operational processes. Do this and you can make sure you stay on the right side of the regulator.
Outcome 1: Consumers can be confident they are dealing with firms where the fair treatment of customers is central to the corporate culture.
This is a core aspect of the FCA’s approach. The regulator is looking for firms to develop cultures where good governance is inbuilt. This was the theme of its speech at a financial services conference in the summer, as well as a major focus in its 2016-17 Business Plan.
Achieving this outcome means putting compliance at the centre of your processes (automation may help here, by making the necessary reviews, approvals and audit trails compulsory). Read more tips in 5 ways to embed a compliance culture into your business.
Outcome 2: Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.
Ensuring your financial promotions are relevant to your audience will get you another big regulatory thumbs-up. It’s something we cover in our blog on how you can help your Marketing team write content Compliance can approve.
Not only will this make sure you get the seal of approval, it will help you get your marketing materials produced faster and more efficiently – saving your firm time and money.
Outcome 3: Consumers are provided with clear information and are kept appropriately informed, during and after the point if sale.
Making sure potential customers have the right information is vital. Our blog on how to ensure your financial promotions meet TCF requirements has some helpful pointers on this.
And it’s not in the sales process that this is needed. The regulator recently criticised insurers for their inadequate renewals communications. Any time you interact with customers or prospects, your approach needs to be compliant.
Outcome 4: Where consumers receive advice, the advice is suitable and takes account of their circumstances.
Products and services need to meet the FCA’s standards on suitability – this blog has tips on how to make sure your culture is geared towards delivering the most appropriate solutions.#
Outcome 5: Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.
Partly, of course, this outcome relies on product performance, and the robustness and market-worthiness of your solutions. But it also has relevance to financial promotions.
Your promotions need to include the relevant risk warnings and disclaimers – something that can be a bit of a lottery, as this blog explores. These warnings will set consumer expectations about the way your products perform, and what customers can expect. They need to meet strict requirements on prominence to make sure they cannot be easily missed.
Outcome 6: Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.
Again, culture can be the culprit here. Our blog on how to identify problems with your corporate culture has tips on how to spot and address failings.
The regulator’s consumer outcomes are not difficult to achieve, if you put in place robust processes, make compliance approvals processes mandatory and put compliance at the heart of your organisation’s culture.