In July 2023, the principles and regulations of Consumer Duty came into effect. The Financial Conduct Authority (FCA) implemented Consumer Duty which is aimed at enhancing and clarifying standards for consumer protection within the financial services sector. The new regulations mean that providers of all sizes need to monitor, and where necessary evolve, to ensure they are delivering good outcomes for customers.

The greater focus on consumer outcomes means companies are required to actively assess, improve and evidence how their actions and processes are working to deliver to the Consumer Duty regulations. The regulation falls into four outcome areas:

Products and services: are specifically designed to meet the needs of consumers and sold to those whose needs they met.

Price and value: the price of products and services represents fair value for consumers.

Communications: consumer understanding to equip consumers to make effective, timely and properly informed decisions about financial products and services.

Customer service: consumer support to meets the needs of consumers, enabling them to realise the benefits of products and services and act in their interests without undue hindrance (across all consumer touch points).

Given the significant impact of the new regulation financial services companies impacted have been working to put in place solutions and steps to meet the obligations. To help shape the response to Consumer Duty we wanted to provide an evidence-based view of consumer experience through the lens of Consumer Duty.

We have undertaken two waves of research into consumer experience of financial services under the lens of Consumer Duty. Each of the two waves of research was designed to be robust in nature and provide a nationally representative view:

- We spoke to over 3,500 consumers in each wave across 14 financial products

- The initial wave in February 2023 was designed to benchmark performance against the four outcomes of Consumer Duty and the incidence and approach to vulnerability

- The second wave of research was undertaken in November 2023, it included additional questions covering consumer awareness and perceptions of Consumer Duty as well as testing consumer understanding.

The insight gathered from both waves provides an evidence-based view of consumer experience across the outcomes. This has meant we can share and shape our clients strategy towards measuring, monitoring and evolving products and services.

• The FCA is anticipating a significant change in how financial products are sold, structured and serviced through the introduction of Consumer Duty.

• Consumers are not yet feeling the benefits of changes introduced in pursuit of the outcomes of Consumer Duty. A more complete picture would be achieved in July 2024.

• Consumer understanding is likely to have been impacted by a reduction in the frequency of the communications they receive. Anticipated scrutiny of comms is likely to explain this trend.

• Firms will be asked to provide a variety of data sources to evidence compliance with Consumer Duty. Customer experience data will be important but is not without its limitations.

• Providers of financial services are not successfully identifying characteristics of vulnerability. Where vulnerability is identified, services are being adapted to accommodate a small proportion of customers