Advisers and other financial services professionals have partaken in a ‘feast of frogs’ over the past year and a half, according to Sheldon Mills, FCA executive director of consumers and competition.
The comment made in a speech to mark the one year anniversary of Consumer Duty coming into effect was a reference to his call 18 months ago for the industry to ‘eat the frog’. The phrase means tackling a difficult or unpleasant task to get it out of the way. In this context, it referred to implementing Consumer Duty.
“I am very pleased to say that in the intervening 18 months, we have seen a, hypothetical, I must add, feast of frogs,” Mills said. “I want to take this opportunity today to celebrate how far we’ve come already to meet those goals. And, to talk about what comes next.
“But before I do so, I wish to return to the lilypond, and to frogs. One of the fascinating things about frogs is that not only can they jump, but they can leap,” he continued.
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Mills (pictured) went on to outline some of the improvements he has seen and where he would like to see further progress over the coming months.
In terms of the former, he noted firms’ development of new data to better understand customers, improved capture and recording of information about customer vulnerabilities, more proactive communications, and expanded support to better meet customer needs.
Some firms have changed their employee bonus structures to make sure that incentives are right, and employees only get good outcomes when their customers do, he added.
Turning to where to improve from here, Mills pointed to careful adoption of technology such as AI.
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“Technological advancements have opened up opportunities for firms to innovate and provide products to respond. But this shouldn’t be at the expense of wider inclusion. Last week we published rules which will help support the three million people who still rely strongly on cash and the millions of small businesses who need to deposit cash.
“Balancing innovation with consumer protection while supporting the need to grow the economy is a crucial focus under our objectives. For example, AI presents opportunities for firms who are thinking creatively about opportunities for innovation and efficiencies.”
Mills went on to outline an information gathering process that will inform the FCA’s stance going forward.
“As we have opened the Call for Input, and as we move past today’s milestone, we’re firmly focussed on what comes next,” he said. “In the coming weeks, we will publish a grid of our forward programme of Consumer Duty work. In this programme, we have prioritised initiatives where, first, there is a need to act to address harm, or potential harm, to retail customers.
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“Second, we want greater understanding of how you’re embedding the Duty, the outcomes your customers are getting, and where potential issues are emerging,” Mills continued. “Where we need more data and information from firms, we’ll only ask for what we really need.
“And third, we believe sharing more information on good practice and our expectations will benefit industry and help drive better outcomes.’
