PIMFA
Customer Vulnerability Conference Highlights
- What is customer vulnerability?
A vulnerable customer is “someone susceptible to harm due to their personal circumstances, especially if a financial services firm is not acting with appropriate care.”¹ All customers are at risk of becoming vulnerable, but the risk is increased by particular characteristics, which could include poor health, certain life events, low resilience to cope with financial or emotional shocks, or low literacy or numerical capability.
The 2021 FCA guidance, ‘Guidance for firms on the fair treatment of Vulnerable Customers’, sets out expectations for firms, and the Consumer Duty has further emphasised the importance of vulnerability and has created further guidance and opportunities for firms to support customers.
- Key FCA expectations for firms:
- Consider the diverse needs of your customers at every stage of the customer
journey and across the product and service lifecycle. - Have effective systems and processes in place.
- Have effective staff training in place.
- Be proactive. Don’t just wait for customers to tell you about vulnerability.
- Take action. Identification of customers with characteristics of vulnerability isn’t an end in itself.
- Monitor the outcomes experienced by customers in vulnerable circumstances and continually improve
This guide provides support for firms to identify, support and achieve good outcomes for vulnerable customers.
our latest work
Miss the Customer Vulnerability Conference?
Did you miss the PIMFA Customer Vulnerability Conference? Make sure you are up to date and watch the recording nowor read the full briefing here.
Financial Conduct Authority webinar - The Vulnerability Review: Findings and next steps
The Financial Conduct Authority (FCA) hosted an event on 11 March with key stakeholders across the financial services industry to reflect on their review findings.
Noting that vulnerability is a dynamic and evolving issue, Jo Legg (Head of Consumer Policy and Outcomes) set out expectations on firms to continually learn, adapt, and improve their products, services and processes to ensure consumers achieve good outcomes.
Tailored communications, disclosure and comprehensive training were highlighted as three key areas for firm focus.
- In the context of identifying vulnerabilities, firms should give consideration to such needs when designing products and services
- Firms should also consider developing their approach to monitoring outcomes to actively identify any issues and take appropriate action
- Identification and disclosure of vulnerabilities will enable a firm to better flex their processes – where firms adopt a flexible approach & have empathy with end consumer, better outcomes are delivered
- Consumer Duty (CD) is purposely designed with an outcomes focus so that firms can adapt their approach – it should be proportionate and commensurate to the firm and business model
Noting that vulnerability will be an area of focus for their ongoing and future CD work, the FCA advised they will maintain the guidance (FG 21-1) as a useful tool alongside CD obligations and will share further good and poor practice examples with details and actionable insights to enable better outcomes are delivered.
- Watch the webinar now – The FCA’s Vulnerability Review – Findings and next steps webinar
Please note if you did not register for the live event on 11 March, you will need to register details on the FCA site to access the recording. - The FCA have also published the review findings
- Read our summary
