What does Consumer Duty mean for clients of advisers?
- Robin Powell
- Jan 16, 2024
- 2 min read
Updated: Oct 14, 2024
The UK financial regulator recently introduced new rules, known as the Consumer Duty, requiring financial advice firms to ensure that customers receive “good outcomes”.
The very fact that the FCA considered the Consumer Duty necessary should act as a warning to people looking for an adviser to work with.
The good news is that ethical and professional standards in financial advice are improving. But there are still far too many firms that don't have clients' interests at heart.
In his latest article for rockwealth, ROBIN POWELL identifies some of the warning signs to look out for.
Financial regulation in the UK moves slowly. The Financial Conduct Authority has been criticised over the years for not acting faster, and more decisively, to protect consumers. But, last summer, the FCA introduced new rules that all financial services firms need to abide by, known as the Consumer Duty, and it might just prove a landmark moment.
But what exactly does the Consumer Duty mean? In a nutshell, it seeks to ensure that customers receive “good outcomes” and that firms provide evidence that these outcomes are being met.
What the Consumer Duty requires of firms
For example, firms have to provide you, the customer, with helpful and accessible customer support. It should be as easy to switch or cancel your product as it was to buy it in the first place.
Firms are also required to give you timely and clear information that you can understand, so you can make good financial decisions. So, for instance, they’re no longer allowed to bury important information in lengthy terms and conditions as they did in the past.
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