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A financial services consumer duty

Striking a delicate balance

The financial services industry is a complex ecosystem.

There are numerous products and services on offer to a variety of retail consumers each with their own individual requirements. This activity takes place around an intricate reef of financial services firms, infrastructure and regulation.

Interventions sometimes are necessary, but they do affect the ecological balance – sometimes in unforeseen ways.

The FCA is imposing a consumer duty on firms dealing with retail consumers. It is looking to secure a “paradigm shift” towards more outcomes-focused regulation.

This may have far-reaching implications for consumers and firms – even those without a direct end-relationship with consumers.

The consumer duty will apply to all new and existing products and services from the end of July 2023, and to closed products and services from the end of July 2024. But firms must now act swiftly: the FCA expects firms’ boards to scrutinise, challenge and agree implementation plans by the end of October 2022.

Our London Financial Regulation and Contentious Regulation teams can help you to navigate these shifting waters.

In microcosm

The final rules - your implementation journey begins

Episode 7

The FCA has now published its final rules implementing a new Consumer Duty. In this podcast episode we highlight key changes from the draft rules and begin to explore what the implementation journey will look like across the spectrum of firms subject to the Duty.


 

The second consultation - implications for asset managers

Episode 6

Scope, application to asset managers throughout the distribution chain, and steps to take to prepare.


 

The second consultation

Episode 5

What changed between the first and second consultation, what questions the second consultation paper answers, and what steps you can take to prepare.


 

Asset Managers

Episode 4

Financial regulation counsel Sara Cody and Raza Naeem explore how the duty would apply to various firms in the distribution chain, go beyond existing TCF obligations, and have particular implications for customer communications and fair value.

View our note on the key focus areas for asset managers >

View our infographic on the key considerations for Asset Managers >


 

Fintechs & Challengers

Episode 3

Financial regulation senior associate Simon Treacy and managing associate Duncan Campbell discuss the implications for fintechs and challengers including around data, UX/UI, online/app channels, product complexities and fees, fair value and intermediation.

View our infographic on the implications for Fintechs & Challengers >

View our note on the implications for payments and e-money firms >


 

Consumer Redress

Episode 2

In this podcast episode we review the various mechanisms for consumers to obtain redress from financial services firms. We assess how the FCA’s proposal to extend the private right of action to cover Principle breaches (including any new Consumer Principle) might fit within the current framework. Crucially, will this achieve the FCA’s aim of securing a higher level of protection to consumers?

This episode features Lara Adamson (Associate, Dispute Resolution, London), Tom Rudrum (Associate, Dispute Resolution, London).

View our infographic outlining the current redress framework >


 

The first consultation

Episode 1

Dispute resolution partner Alison Wilson and financial regulation counsel Sara Cody discuss the FCA's recent consultation on the introduction of a "consumer duty" in financial services. We give an overview of the proposals and consider their key aspects, and give some thought to the practical implications for firms.

View our infographic on the proposals >


 

Insurers

View our note on the implications for insurers >

Recent Publications

umbrellas

Lines of duty - what the FCA's Consumer Duty means for insurers

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Yellow glass wall

UK: FCA consults on a new Consumer Duty

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Alarm clock on charts

Why wait? Challenger banks prepare for the FCA’s Consumer Duty

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