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FCA publishes guidance on the fair treatment of vulnerable customers

Jake Carter

February 23, 2021

The Financial Conduct Authority (FCA) has published its final guidance for firms on the fair treatment of vulnerable customers.

It aims to drive improvements in the way firms treat vulnerable consumers so that they are able to achieve the same outcomes as others.

The FCA’s recent ‘Financial Lives’ research shows that 27.7 million adults in the UK now have characteristics of vulnerability such as poor health, experiencing negative life events, low financial resilience or low capability.

The authority believes that firms should understand what their customers are likely to be vulnerable to and ensure that customers in vulnerable circumstances can receive the same fair treatment and outcomes as other customers.

The guidance went on to outline that in order to achieve this, firms must assist consumers through the whole customer journey from product design to customer engagement and communications.

Using the guidance, the FCA will continue to hold firms to account for their treatment of vulnerable customers.

Firms can expect to be asked to demonstrate how their business model, the actions they have taken and their culture ensures the fair treatment of all customers, including vulnerable customers.

In addition, firms are reminded that in treating customers fairly, they should also be aware of their obligations under the Equality Act 2010.

It is likely that a breach of the Equality Act will also be a breach of the FCA’s rules.

Furthermore, the FCA has published a Memorandum of Understanding (MoU) with the Equality and Human Rights Commission (EHRC).

This MoU outlines how the FCA will co-operate and work with the EHRC on equalities issues, to help protect people in financial services markets.

The MoU is also intended to support the authority in eliminating discrimination and advancing equality of opportunity in line with its obligations under the Public Sector Equality duty.

Nisha Arora, director of consumer and retail policy at the FCA, said: “Protecting vulnerable consumers remains a key focus for us and given the impact of the coronavirus pandemic, it is more important than ever that firms get this right.

“The guidance being announced today will help ensure vulnerable consumers are treated fairly and achieve outcomes as good as other consumers.

“While some firms have made significant progress, we want to see all firms across sectors taking steps to understand and respond to the needs of their customers, particularly those who are most vulnerable to harm.

“We also remind customers to tell your providers if you have specific needs – whether that’s due to ill health making it difficult to access a service, or a recent emotional or financial shock that is impacting your finances.

“Doing this will help firms support you.”


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