Treating customers fairly - Financial Conduct Authority

Treating customers fairly

Last Modified: 03/03/2015
Treating customers fairly (TCF) remains central to our expectations of firms’ conduct, that firms put the well-being of customers at the heart of how they run their businesses.

Treating customers fairly and today's market

The current economic environment remains challenging for firms, with a continuing low interest rate environment where returns on investments have not returned to the levels seen in the past. This generates risks for consumers.

Firms will be looking to move into a phase of growing revenue by cutting costs and increasing revenues in order to maintain or improve profitability at the same time as consumers are reducing levels of household debt and looking to save and invest their money with good returns. Some consumers will be in financial difficulty and may struggle to maintain commitments made during the years before the crisis.

TCF, with its focus on consumer outcomes, is central to our work in ensuring a fair deal for consumers. It underpins the delivery of our statutory consumer protection objective and the future objectives of the FCA. Whatever the economic and financial conditions may be, firms must put and keep consumers at the heart of their business. Firms should not focus on their own risks, where to do so may be to the detriment of customers.

Expectations of firms

We expect customers’ interests to be at the heart of how firms do business. Customers can expect to get financial services and products that meet their needs from firms that they can trust. Meeting customers’ fair and reasonable expectations should be the responsibility of firms, not that of the regulator.

The six TCF outcomes

Our six consumer outcomes explain what we want TCF to achieve for consumers. These were outlined in our July 2006 publication, Treating customers fairly – towards fair outcomes for consumers. These remain core to what we expect of firms. We will continue to use them as an important factor in guiding regulatory decisions and actions.

  • Outcome 1: Consumers can be confident that they are dealing with firms where the fair treatment of customers is central to the corporate culture.
  • Outcome 2: Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.
  • Outcome 3: Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.
  • Outcome 4: Where consumers receive advice, the advice is suitable and takes account of their circumstances.
  • Outcome 5: Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.
  • Outcome 6: Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.

Management information

We continue to expect firms to make use of suitable management information to monitor the outcomes that they are achieving for customers. This may comprise a range of information of different types, both numeric and descriptive, but it is important that it is forward-looking (enabling management to identify risks to customer outcomes rather than dealing only with known issues) and that it is acted upon when necessary.

In 2007, we published Treating customers fairly - guide to management information. This guide is designed to help firms develop MI to demonstrate that they are treating their customers fairly and includes hints and tips on gathering and using MI, along with examples of good and poor practice. This remains relevant.

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