Countdown to the Consumer Duty

Back in February, we wrote about the top 5 ways to aid compliance with the Consumer Duty, helping any organisation operating within the financial services space to ensure they are compliant with the forthcoming Consumer Duty – the Financial Conduct Authority’s (FCA) new regulatory framework. With less than a month to go until the new regulation comes into force on 31 July 2023, we thought it pertinent to revisit the topic.

Per the FCA, the Consumer Duty “sets higher and clearer standards of consumer protection across financial services, and requires firms to put their customers’ needs first.” At IPI, we are dedicated to putting our clients and their customers first, so that everyone experiences an exceptional Contact Centre journey. We understand the importance of ensuring every customer receives the highest quality care.

But what does the Consumer Duty mean for UK financial firms and their customers?

What to expect from the Consumer Duty

The Consumer Duty sets out clear guidance to better protect customers across the sector and requires firms to “act to deliver good outcomes” throughout its communication with customers and its recommendations of products/services.

Overall, there are four main components of what the FCA expects the Duty will deliver:

1. Consumer understanding – With complex choices about debts, mortgages, pensions, and investments, customers can be overwhelmed by the information on the financial services available to them. Under the Consumer Duty, financial services products are expected to come with timely and clear information – on everything from product features to charges – that customers can understand so they can make informed decisions. Against today’s challenging financial climate, ensuring consumers have access to this information is crucial.
2. Products & services – From high-risk investments to unsuitable debt products and unaffordable credit, financial services organisations have been known to push products that aren’t suitable or don’t meet customer needs. The Duty aims to stamp this out and ensure firms are offering their customers the services and products they actually need.
3. Price and value – It’s a financially challenging time for many, and the FCA wants to ensure with Consumer Duty that consumers receive fair value. This isn’t the FCA setting price caps or stifling innovation, but it is expected that the amount a consumer pays for a product or service is ‘reasonable’ when compared with the benefits the product or service offers. Firms should be able to justify the ‘fair value’ of each product or service offered to any type of customer group, including those with characteristics of vulnerability.
4. Consumer support – This is the key component for IPI and our clients. Nobody likes long call-waiting times, being directed to the wrong team or unhelpful chatbots, and with more and more tech-savvy consumers joining the playing field, it’s no secret that customers want their problems solved quickly and effectively. They also want the opportunity to reach out to their financial services provider on multiple channels, from phones and emails to social media and live chat. Through Consumer Duty, the FCA expects firms to ensure customers are supported throughout their whole experience with a firm, and that multiple avenues are considered – whether digital or non-digital – to engage consumers and meet their diverse needs

These changes come at a challenging time for consumers and the economy, but the introduction of the Consumer Duty offers an opportunity for UK financial firms to better support customers by providing them with a more comprehensive understanding of what they are offering. This helps build consumer trust and loyalty within the financial services industry, achieving good outcomes overall. For organisations themselves, the new regulation will mean a fairer basis for competition, leading to growth and innovation.  And in the end, confident consumers and businesses mean only good things for the UK economy.

The path to compliance

Ensuring compliance with these four components might seem overwhelming, so as a reminder here are our top five ways for Contact Centres to enhance their customer centricity and kick-start their journey to compliance:

1. Use proactive and automated communication – By using CRM systems and linking them into Contact Centre communication channels such as SMS and email, automated communications can be sent to help inform customers at exactly the right point in the journey, without the need for manual intervention. Organisations can then use this communication to demonstrate that the appropriate steps have been taken to communicate with customers at the right time and with the right information.
2. Establish fair interaction routing priorities – Introduce intelligent call routing to appropriately route all calls effectively so customers seeking a service are delivered to the right team, and not taking a detour through the sales department.
3. Introduce agent assist tools – To make Contact Centre agents’ jobs easier, and to ensure they don’t miss vital signals that will enable them to trigger certain actions or to share additional information, Contact Centres can introduce agent assist tools that, through a simple on-screen pop-up, prompt the agent to flag further information based on trigger words or phrases.
4. Speech analytics – Use speech and text analytics tools to review agent-customer conversations to ensure they don’t fall foul of regulations – such as vulnerability and pressure selling. Such tools can also be used to highlight specific topics and phrases that trigger the correct follow-up actions. The data collected from these tools can also be used to drive process improvements, ensuring that the service delivered remains up to standard.
5. Train your agents – Introduce dedicated coaching sessions, managed through a workforce management platform, to ensure agents are aligned with the new regulation requirements. Training sessions can also be adapted to meet an individual organisation’s requirements, and will also allow organisations to document to the FCA that the appropriate steps are being taken to better serve customers.

Putting customers first

These processes and solutions, while potentially implemented to meet the Duty regulations, will have benefits far into the future, providing a customer-centric experience that meets regulations and customer expectations.

If you’d like IPI to help you kick-start your future-proofed initiatives, please get in touch with the team: https://ipintegration.com/how-to-get-in-touch/

Craig Farley

Craig is Head of Solution Consulting at IPI. With over two decades of experience in the dynamic world of contact centres, he’s seen the industry evolve, and evolved with it. Craig’s journey began with hands-on operational roles, focusing on technology, resource planning, and leadership.

Throughout his career, Craig had the privilege of collaborating with global brands, empowering them to harness cutting-edge technology and streamline their operations. Today, Craig leads Solution Consulting at IP Integration, where we leverage our extensive industry experience to help clients deliver exceptional customer experiences.