The Financial Conduct Authority (FCA) is currently considering giving financial services firms a six-month ‘grace period’ to adjust to the Consumer Duty when it come into place next year.
The full set of rules are yet to be published by the regulator and are expected to come out by the end of July 2022.
It seems, however, that the implementation date will remain the same – by April 2023 – but potentially firms will be given six months, until around October 2023, to adjust to the regulatory development.
A spokesperson for the FCA said: “We have received extensive feedback from industry and consumer groups to the consultation question on the implementation period and are considering all potential options. No final decision has been taken on implementation. Our final decision will be made at our board meeting in July.”
If the watchdog rolls out a six-month grace period, this will undoubtedly be welcomed by financial advisers as a recent survey by M&G Wealth found that 80% were concerned or very concerned about the incoming regulation and subsequent research from Abrdn discovered a quarter of planners were completely in the dark about the set of rules.
At the core of the Consumer Duty is a greater focus on consumers, forcing companies – from providers to financial advisers – to ensure products and services are suitable, understood by savers, and offer the best value for money.
The FCA has stated that the set of rules being introduced will ignite a “fundamental shift” in consumer protection standards, after the watchdog was criticised for a lack of clarity and credible threats to the bad apples in the sector.