The FCA has set out what financial firms can do to improve how
products and services can better meet consumers' needs.
When products are designed with consumers' needs firmly in mind,
they can support good outcomes, helping people make informed
choices, get fair value, and receive the support they need over
time to navigate their financial lives.
But when product design falls short, it can confuse or mislead,
increase complaints and erode trust. And people can end up paying
for poor value if products fail to adapt to changes in their
circumstances.
The FCA found improvements in how firms design, monitor and
distribute products and services under the Consumer Duty, which
reduces the risk that people get poor outcomes from buying
unsuitable products. In one example, complaints about ATM
withdrawals fell by 45% in three months after a firm made app
information clearer and improved staff training.
Many firms had also improved product governance, strengthened how
they monitor customer outcomes, and took greater responsibility
for how products and services were distributed.
However, the FCA found some firms could improve how they:
- defined their target markets to make sure products were
suitable and work as intended from the outset
- identified emerging risks from unsuitable products and
services which lead to poor customer outcomes
- oversaw third parties that delivered products and services to
customers on their behalf.
Charlotte Clark, Director of Cross-cutting policy at the
FCA, said:
Consumers should be able to trust that the products and services
they rely on to navigate their financial lives are designed for
their needs, monitored properly, and deliver the outcomes they
expect.
The good practice we've found really matters because where
products are poorly targeted, or firms lose sight of what's
happening across their distribution chains, consumers can lose
out - whether that's poorly performing products, slow complaint
resolution, or paying for services that don't meet their needs.
Rebecca Deegan, Director at Fair By Design,
said:
At Fair By Design, we see the every-day impact when products and
services aren't designed around people's lives, and how it can
contribute to financial exclusion and the poverty premium.
This report is a welcome and practical contribution to improving
consumer outcomes. The examples it highlights, including the use
of inclusive design principles, show how firms can move beyond
identifying vulnerability to designing, monitoring and adapting
services that work better for everyone.
Notes to editors
