Consumer Duty

The FCA published the final rules for the new Consumer Duty in July 2022. Implementation within 12 months was required for most regulated businesses for new and existing products and services open to sale or renewal, and further implementation by July 2024 for closed products or services.

The new Consumer Duty requires firms to have a detailed framework to meet the FCA’s high standards of consumer protection. Their high regard is demonstrated by the addition of principle 12 to the Principles for Businesses, which states “A firm must act to deliver good outcomes for retail customers”. The duty also introduced three cross-cutting rules to strengthen the standards of conduct expected by the FCA under this new principle.

• Act in good faith towards your retail, micro-enterprises and charity (>£1m turnover) customers.
• Avoid foreseeable harm to your retail, micro-enterprises and charity (>£1m turnover) customers.
• Enable and support your retail customers to pursue their financial objectives.

Supported by the remaining rules and expectations of the guidance, implementation of the duty should support firms in achieving the four good outcomes for consumers.

• Products and Services
• Price and Value
• Consumer Understanding
• Consumer Support

How API Compliance supports your consumer duty implementation

Since the NCD final rules and guidance were published, we have worked with a range of payment services and e-money firms, helping management and team leaders to understand the duty, and supporting them to develop an implementation plan tailored to their firm’s business services. This journey usually consists of gap analysis, recommendations, support in developing the policies and procedures of your chosen approach, training, and regular independent review of the effectiveness of your implementation.