Posted December 7, 2021
The Money Advice Trust has welcomed the FCA’s plans for a new Consumer Duty that are intended to ensure a more consistent standard of consumer protection in financial services and help stop harm before it happens.
“The FCA is right to say that the financial services market does not always work well for consumers – many of whom have been placed at risk of harm or financial exclusion. Today’s proposals for a new consumer duty are welcome and – together with new vulnerability guidance published earlier this year – should provide greater protection for all consumers.
“I am encouraged to see the emphasis on product design and ensuring products are fit for purpose as part of these proposals. Ensuring good consumer outcomes are considered at the initial product design stage is an important step to preventing harm from occurring in the first place.
“The Consumer Duty as proposed will benefit consumers and firms alike – further protecting consumers, while also creating a level playing field for firms - by preventing some firms undercutting those who already do the right thing.
“To ensure these proposals achieve what they set out, they will need to be backed-up by practical measures. This needs to include a robust authorisation process to stop poorly designed products entering the market, and regulatory intervention and enforcement if and when needed.”