By: 30 July 2024
Consumers seeing no improvement from FCA’s Consumer Duty

Lack of impact from FCA Consumer Duty

The majority (84%) of consumers report no improvement in how financial providers treat them following the implementation of the FCA Consumer Duty a year ago. According to a new study conducted by Smart Money People, 7% of consumers even report worsening service over the past 12 months.

Consumers’ biggest frustrations include no access to human support (48%), untrained staff (34%), no available phone number (32%), and an over-reliance on chatbots (24%).

Despite these grievances, only 23% of customers have left a review for their provider in the past 12 months, and only 35% have given feedback directly to their provider in the past five years. This suggests that many negative experiences are not being recorded.

Personal loan and buy now, pay later customers are particularly dissatisfied, citing over-reliance on ‘live chats’ (30%) and poor customer communications (28%) as top reasons for their dissatisfaction. Additionally, 22% of people had experienced unempathetic staff members.

Jacqueline Dewey, CEO of Smart Money People, commented: “The FCA’s Consumer Duty guidelines are specifically designed to put the onus of consumer communications and outcomes on the provider. However, our data shows customers are not seeing the impact of these guidelines 12 months later. It’s particularly concerning that vulnerable customers have not seen an improvement in their experience during this time. This is why we are encouraging consumers to feedback on both good and bad experiences.”

Poor reviews for health insurers and pension providers

An analysis of Smart Money People’s platform data, which holds over 2 million independent reviews, shows that health insurers and pension providers receive the lowest reviews from customers.

This indicates that health insurance customers are more willing to review providers, while loan customers are more hesitant about leaving reviews. In contrast, prepaid account and current account customers are the happiest with their providers, with current accounts receiving the most positive reviews. The research found that efficient service (49%) and knowledgeable staff (33%) lead to the most satisfied customers.

To encourage the industry to pay attention to customer needs and wants, Smart Money People has launched the ‘Your Money, Your Voice’ campaign, urging customers to leave more reviews of their financial providers. Dewey emphasised the importance of feedback, stating: “Smart Money People works with financial services organisations to better understand and serve their customers, helping to drive better outcomes for both providers and their customers.”

 

Vulnerable customers seek better support

In the study of 2,000 consumers, a proportion self-reported on criteria that would consider them vulnerable by the FCA. These customers highlight access to ‘real people’ as the most important factor for their service experience. Notably, 81% of these customers said they had seen no positive improvement in the way their financial services companies treat them in the past 12 months.

The study underscores the need for financial providers to focus more on the specific needs of vulnerable customers. Dewey added: “It’s particularly concerning that vulnerable customers have not seen an improvement in their experience during this time. This is why we are encouraging consumers to feedback on both good and bad experiences.”

By participating in the ‘Your Money, Your Voice’ campaign, customers can help ensure their experiences are heard, driving financial providers to improve their services and better cater to the needs of all consumers.

 

Image: © Adene Sanchez via Canva
Emma Cockings
Emma is a content editor for Claims Media. Emma is a experienced writer with a background in client-centric personal injury for a major firm. She has attended and reported on multiple brokerage events throughout her career.