Understanding Consumer Duty in Mortgage and Protection
The Mortgage and Protection Event discussed the new FCA Consumer Duty rules and guidance, emphasizing the importance of good consumer outcomes. Mortgage intermediary firms need to assess their current practices against the new standards to ensure fair treatment and monitoring of outcomes. The scope of Consumer Duty includes regulated business, BTL and CBTL impact, business strategy, and customer proposition. Other core areas affected include SM&CR, governance, culture, and support for vulnerable customers. Consumer Duty presents an opportunity to enhance consumer propositions and should be embraced by the sector.
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The Mortgage and Protection Event Getting to grips with Consumer Duty Chloe Timperley, Senior Policy Adviser November 2022
AMI Thetradebody for the profession Non-commercial, not-for-profit trade body, launched in 2003 Represent member firms interests Work with UK Finance, BSA, IMLA, ERC, FLA, ABI, PDG Liaise with FCA, FOS, FSCS and Moneyhelper as well as Treasury, DLUHC and BEIS Our objective is to play a critical but constructive role within the regulation process Encourage all firms to join Greater the membership = the LOUDER our voice
Todays session Learning objectives: Have an understanding of the key aspects of the new FCA Consumer Duty rules and guidance and the required timetable for delivery. Be better able to assess the impact of the new rules and guidance on their firm, particularly the Consumer Principle; the cross-cutting rules and the four outcomes and be better able to develop their own plans.
Consumer Duty Good consumer outcomes Treating customers fairly But my firm does this already? Even so, it s unlikely you re evidencing and monitoring outcomes to the level required under Consumer Duty + New rules and guidance are quite detailed important to assess what you do now vs new standard
Consumer Duty whats in scope? All mortgage intermediary firms but proportionate approach. A firm s regulated business. Impact on BTL and CBTL. Overall business strategy and end-to-end customer proposition. Where and how can we make improvements to ensure good consumer outcomes? Builds on concepts such as TCF, vulnerable customers, clear, fair and not misleading comms and product governance.
Consumer Duty other core areas Also see changes impacting the areas of: SM&CR Governance Culture Vulnerable customers Consumer Duty should be seen as an opportunity to improve your mortgage and protection consumer proposition. We believe the Consumer Duty will be good for our sector and should be embraced and not feared. Association of Mortgage Intermediaries
Consumer Duty Consumer understanding Price and value Four outcomes Products and services Consumer support
Consumer Duty evidence is key Will not be enough to say that you put the consumer at the heart of what you do need evidence to show the outcomes your customers are experiencing. Important to act on insight - learn and make improvements to the business. FCA has helpfully included examples of MI in the Non-Handbook Guidance (Chapter 11). This evidence will also be crucial should a complaint go to FOS.
Consumer Duty how to prepare Key dates 30th April 2023, 31st July 2023 and 31st July 2024. All firms should start with a gap analysis.
How to join AMI Please visit our website: www.a-m-i.org.uk and click on membership , then how to apply . [We] review all correspondence issued by AMI and in particular their recent work on the new Consumer Duty. We find their insight and interpretation of complex material issued by the regulator to be extremely useful operationally, are always written in plain English and help us get a feel for the industry direction of travel. We value our membership of AMI highly. AMI member firm, August 2022.
