The Financial Conduct Authority (FCA) has today published a consultation entitled FCA Mission – Our Future Approach to Consumers. The FCA’s mission paper is the first in a series of documents that will explain its approach to regulation in more depth.The FCA wants to see markets where:
- Consumers are enabled to buy the products and services they need because the environment in which they are sold is clear, fair and not misleading, with a good choice architecture
- High-quality, good value products and services are available that meet consumers’ needs
- Everyone is able to access the financial products they need
- Consumers are appropriately protected from harm
- The needs of vulnerable consumers are taken into account.
Underpinning the approach are five core ideas:
- Firm and Customer responsibility: Firms must treat customers fairly. Financial products and services should be available to consumers and marketed and sold in a way that allows them to make informed choices. Consumers should take responsibility for the decisions they make about the financial products and services they buy. Where customers face challenges which mean they may not make the best decision for their particular needs, firms must not exploit these customers and should exercise extra care where consumers may be vulnerable.
- Regulating for vulnerable consumers: Any consumer can become vulnerable at any time in their life, for example through serious illness, bereavement or loss of income. The FCA expects firms to pay attention to possible indicators of vulnerability and have policies in place to deal with consumers where those indicators suggest they may be at greater risk of harm.
- Keeping pace with a changing environment: The FCA acknowledges that the way customers and firms make decisions are constantly evolving. The FCA takes account of the different needs of consumers. The FCA will use behavioural economics and Data Sciences to ensure its approach to regulation is suitable.
- Having regard to access and tackling exclusion: The FCA will work with firms and stakeholders to develop strategies to tackle access problems. This will include both examining FCA rules and ensuring that they are being interpreted correctly.
- Delivering better outcomes for all consumers, which requires co-operation between firms, consumers and the FCA.
The FLA will respond to the consultation by the closing date of 5 February 2018 following consultation with members.