Consumer Duty
Delivering good outcomes
Four outcomes
Effective Date
The introduction of the Consumer Duty in 2023 is a landmark event for financial services and will influence the future development of all areas of our industry.
For Ravenscroft the core principle of the Consumer Duty - focusing on the consumer and good consumer outcomes - aligns with our client-first ethos and our established approach of working closely with our clients to help achieve their financial objectives.
Consumer Duty - key information
Why is the Consumer Duty being introduced?
The FCA wants to improve the level of protection for consumers who use financial services and products.
What is the Consumer Duty?
Consumer Duty (the ‘Duty’) builds on existing regulations for firms working in this market and goes further in that firms should evidence that they ‘act to deliver good outcomes to retail clients’.
Who is affected by the Consumer Duty?
The scope of Consumer Duty is broad and includes all those involved in; designing and building of products and services, their distribution and communication and ongoing servicing.
When will Consumer Duty take effect?
There are a number of key deadlines for the implementation of Consumer Duty:
- 31st October 2022 – Manufacturers must have agreed plans for implementation.
- 30th April 2023 – Manufacturers complete reviews for new and existing products and services
- 31st July 2023 – Implementation of the rules covering new and existing products and services
- 31st July 2024 - Implementation of the rules covering closed products and services
How are firms required to show they are implementing the Consumer Duty?
There are four areas relating to consumer outcomes where firms should evidence they are targeting good outcomes for consumers:
- Products and services - evidence that all products and services continue to meet the needs of our target audience.
- Price and value - evidence that our products and services provide good value for money.
- Consumer understanding - evidence that our products and services are understood by our target audience.
- Consumer support - evidence that our support and service meets the needs of all our customers
Four consumer outcomes
Products and Services
Price and Value
Consumer Understanding
As a firm we endeavour to ensure that our clients receive the best possible service from us. To ensure this we have put in place:
A Consumer working group
- this group reviews client communications and is made up from individuals across the business to ensure that all relevant aspects are considered and that the clients’ needs (including vulnerability) are fully catered for. All new communications are reviewed by this group and key existing communications are reviewed annually.
Client Communication Standards
- In all client-facing communications our aim is to use clear, simple language; it should be understandable to someone who is not a financial professional. With the exception of required, regulatory wording, we always use plain English and are as concise as possible.
- We have set standards for the size of copy and ensuring legibility such as when contrasting colours are used. Where appropriate we use graphics or images to help divide up information for easier reading, or providing further explanation. Additionally, where relevant, we include contact information, so that further details can be easily requested.
- We have reviewed all key client documents against this criteria and where necessary have made adjustments to copy size and layout for greater clarity.
Communications testing framework
- We have established a client survey to assess the understanding of the key documents used by our clients, from onboarding through to ongoing investment information.
- An initial survey was sent out in February and established a benchmark and identified some areas for improvement. This survey can easily be repeated as required.
Consumer Support
Ensuring our clients receive the right support from us at all stages of their customer journey is part of our commitment to them.
In meeting the Consumer Support outcome, we have reviewed how we support our clients:
- We have reviewed our interactions with clients both in onboarding and our ongoing service to them, which includes; face-to-face meetings, follow-up emails, explanatory documentation and the required forms and administration, to assess the support we are providing at each stage and where we can make any improvements.
- We have looked at how we identify and work with vulnerable clients and what processes we have in place to ensure that they receive the higher levels of customer service required.
- We have analysed any complaints; what are the root causes, how we have approached these and what processes we have in place to monitor where frictions occur. We aim to reduce the potential for complaints and look at ways we can reach a positive outcome should we receive a complaint.
In reviewing our customer support, we have also referenced the cross-cutting principles of Consumer Duty; to act in good faith, avoid causing foreseeable harm and enable and support customers.
