Businesses face 'significant work ahead' to comply with FCA's new Consumer Duty
International law firm RPC says regulator has given companies 'little concession' on timeframe to implement change
Commenting on the Financial Conduct Authority's new Consumer Duty, RPC's Whitney Simpson (Of Counsel), who specialises in non-contentious consumer finance and payment related matters, said:
"The FCA's new Consumer Duty aims to improve the retail financial market, provide a higher standard of consumer protection, but still drive innovation and competition - a complicated balancing act for all firms impacted.
"The requirements aim to focus on the real and diverse needs of all retail consumers, including those who might be vulnerable, to ensure that firms deliver the right outcomes and give consumers the right support when needed.
"Companies are now expected to review their products and services to assess whether they meet expected outcomes, such as representing fair value, being fit for purpose for the customers they marketed to and adapting/evolving products where necessary. This is no small task and presents many firms with significant work ahead to implement the changes required.
"While the FCA has revised the implementation timetable from 9 months to 12 months on new and existing products still being sold or renewed and a further year for closed products, this is still a shorter period than previously provided for other policy changes and presents the challenge of tight timeframes for several businesses. Having to have Boards agree implementation plans by the end of October 2022 is certainly not an easy feat.
"It seems that irrespective of numerous challenges made in response to the consultation, the FCA is largely pushing on with its original approach, with little concession to the rule changes it previously proposed."