Consumer Duty has been one of the biggest events to shape our industry and will continue to be at the forefront of how consumer outcomes are prioritised.
At Aviva, we support the Consumer Duty and its principle of acting to deliver good outcomes for customers. While it brings change and challenge, it also brings opportunity and we'll continue to work with the advice community to ensure its ongoing success.
View Consumer Duty Target Market Statements and Value for Money Assessment Outcomes for all advised open products
Here are the five basics of the Consumer Duty. Much detail lies beneath, but this is a good place to begin.
WHY has the Consumer Duty been introduced?
Individual responsibility for personal finances is greater than ever, but public trust in the personal finance industry remains weak. This is a bad combination. The Consumer Duty addresses this by raising the regulatory expectations of all who service retail customers.
WHAT is the Consumer Duty?
The FCA published its final Consumer Duty rules on 27 July 2022. The consumer Duty builds on previous regulations, but goes further. The Consumer Duty demands that all who operate in this market evidence that they are “acting to deliver good outcomes for retail customers”.
WHO is impacted by the Consumer Duty?
The scope of the Consumer Duty is wide. It applies to all firms which have a material influence over retail customer outcomes. For example, it applies to firms involved in the design, build or operation of retail products or services; firms involved in their distribution; firms involved in their communication; and firms involved in their servicing. In the platform market, the Consumer Duty applies to all firms - throughout the distribution chain - which have a material influence over retail customer outcomes - from the financial adviser, to the platform provider, to the fund manager.
WHEN are the key milestones for Consumer Duty?
The FCA set four Consumer Duty deadlines:
31 October 2022: Implementation plans towards full compliance must have been agreed
30 April 2023: Manufacturers must have completed product reviews against the rules
31 July 2023: The rules apply to all open products and services
31 July 2024: The rules apply to all closed products and services
HOW can a firm demonstrate compliance with the Consumer Duty?
This is the big question. There is no “one-size-fits-all” answer. Each firm must consider how it can evidence it is acting to deliver good outcomes. And four outcomes must be scrutinised:
Products & services: to evidence that the design of all products and services continue to meet the needs, characteristics and objectives of their target market
Price & value: to evidence that that all products and services give fair value
Consumer understanding: to evidence that all communications are understandable and understood
Consumer support: to evidence that all customers can realise the benefits of their product or service
Useful links to FCA Consumer Duty content
The FCA is committed to supporting the success of the Consumer Duty. Below are links to a range of helpful FCA information.
