Estate agency mortgage advisers warned to make 'significant' changes following FCA review

Over the next six months, the FCA wants firms to focus on:

Prioritising: Firms should make sure they are prioritising effectively, with a focus on the areas that will make the biggest impact on outcomes for consumers.

Making the changes needed: The FCA urges firms to ensure they are making the changes needed so consumers receive communications they can understand, products and services that meet their needs and offer fair value, and they get the customer support they need when they need it.

Working with other firms: Firms need to share information and work closely with their commercial partners to make sure they are all delivering good customer outcomes. The FCA has found that some firms need to accelerate this work to implement the Duty on time.

While the FCA wants all financial firms to shift focus on consumer outcomes, it highlights that some may “be behind in their thinking and planning”.

Sheldon Mills, FCA executive director of consumers and competition, said Consumer Duty would bring about a step change in the way financial services firms treat their customers.

However, he cautioned: "Given the scale of the reform, we recognise that some firms need to make significant changes. For firms which are further behind in making the necessary changes, there is time to put that right and for them to show they are acting in the spirit of the new Duty."

Roddy Munro, Head of Proposition Specialists at wealth manager Quilter, said that the review reflects just how seriously the regulator is taking the new Consumer Duty.

He adds: “Given the professionalisation of the advice industry in the last decade and an increasing focus on value, many will be in a good starting position. It is this value that is so important, and it should not be confused for price.

“Clients and their families will value different elements of advice at different points over their lifetimes. As such we cannot look at price in isolation, but as part of the wider picture when evidencing value to clients.

“This Duty, therefore, presses home the point of having quality data collection for each product and service and ensuring the correct metrics are in place in order to remain compliant. We cannot rest on our laurels that we do much of this already.”

The rules come into force on 31 July 2023 for new and existing products or services that are open to sale or renewal, and on 31 July 2024 for closed products or services.