The Financial Conduct Authority has said that just over seven million people unsuccessfully attempted to contact one or more financial services providers.
According to the regulator this shows how important the Consumer Duty is as the “most vulnerable in society are most likely to struggle with this”.
During the 12 months before May 2022, 7.4 million people attempted to contact their financial services provider. This figure comes from the FCA’s Financial Lives survey.
It also showed that less than half (21.9 million) of UK adults had confidence in the UK financial services industry. Only 36% said that most financial firms are “honest and transparent in the way they treat them”.
People were more positive when they had to rate their own provider rather than the sector in general.
The Consumer Duty which will come into force at the end of this month (31 July 2023) will require firms to act to deliver good outcomes for consumers.
And, in turn, help to improve trust and confidence in the financial services sector.
Additionally, the Consumer Duty rules mean firms have to “provide helpful and responsive customer service”. Firms must make it as “easy to complain about or switch and cancel products or services as it was to buy them”.
FCA executive director, consumers and competition Sheldon Mills said: “Times like this show why it’s important people get the support they need as more people are likely turning to their financial services providers for help.
“Our Consumer Duty will guide our ongoing work to improve the way firms provide customer support – getting through to your provider is the starting point for receiving help, so we will be working with them to improve in this area.”
Quilter commercial proposition director Jenny Davidson added: “The Consumer Duty has thrust client vulnerability into the spotlight again and today’s data from the FCA, which shows that 7.4 million people have unsuccessfully attempted to contact one or more of their financial services providers in the 12 months before May 2022, shows that the sector continues to let down the most vulnerable in society.
“Twenty per cent of those with low financial resilience and 20% of those with low capability reported that provider communications did not help at all, compared with 12% of those with no characteristics of vulnerability.
“Vulnerability can be a deeply personal issue. Customers are unlikely to shout about it or may be unwilling to discuss it, so a crucial challenge for all companies is to identify customers on this spectrum of risk.
“All employees of financial services firms must have the skills and capability to recognise and deal with customers who display signs of vulnerability, and the FCA has previously provided guidance on embedding fair treatment of vulnerable customers across businesses.”
This news comes as polling firm Opinium finds that advisers are uncertain about the FCA’s role in developing and implementing the Consumer Duty rules.
A majority (70%) of independent financial advisers think the FCA has been unclear about the Consumer Duty.
Also, two thirds (66%) feel the FCA has been unhelpful, and 62% think it has been unresponsive.
A slight majority (54%) also think the FCA has been unreasonable.
The FCA’s Financial Lives survey had over 19,000 respondents.
