Consumer understanding: good practice and areas for improvement

Using insight to understand where customers struggle

Positive examples included firms using multiple sources to gain insights, such as call listening, complaints, chat transcripts, drop-off data and surveys, to understand which parts of their communications customers find unclear. They review this insight regularly and prioritise improvements based on real evidence, not assumptions.

One firm used website analytics to find out where customers became stuck during the sales process, then tested improvements and monitored whether outcomes improved. This decreased the number of clicks to get to the required outcome and reduced calls to their helpline.

Testing communications before and after launch

Good practice includes testing communications in a proportionate way, using methods such as short surveys, comprehension checks, A/B testing or customer callbacks. Good practice includes documenting what changed, why it changed and the impact of each change, ensuring a clear link between insight and action.

Effective testing uses new, outcomes-focused measures designed to improve consumers’ understanding. This helps firms generate meaningful metrics, identify what works best for different customer groups, and diagnose issues earlier. 

Using testing to improve journeys and tools

Some firms test calculators, videos, walkthroughs or summary pages to confirm whether these tools genuinely help customers understand information. Where improvements are needed, firms iterate and retest to validate the impact.

Other examples include updating a calculator after identifying customer confusion, simplifying a video explainer and retesting comprehension, or redesigning a step in a journey and verifying reduced drop off.

• Weak evidence of testing: Some firms said they had tested their communications but provided little evidence. In many cases, testing was often superficial, one-off or poorly documented.
• Unclear use of MI and insight: Some firms collected MI such as drop-off rates or chat logs but could not explain how this informed their assessment of consumer understanding or supported decisions. We do not expect every data point to lead to action. But firms should be able to show why the MI they collect is relevant, how they review it, and how it helps them identify where customers may not understand key information. Several firms continued to rely on sales data or the absence of complaints as evidence of understanding. This does not provide reliable assurance, even taking into account the size and complexity of firms.
• Insufficient testing with different customer groups: Some firms did not test communications with people with accessibility needs, language requirements or lower financial capability. This meant it was unclear whether changes supported consumer understanding for these groups. It was not always clear that firms had assessed their target market to make sure their communications were designed appropriately. Firms should be mindful of consumers with characteristics of vulnerability or low capability while acting in good faith. Not testing communications for these cohorts increased the risk that they may receive poor outcomes.
• No follow-up to assess whether changes worked: Changes were made, but the firm did not check whether they had worked. Records often failed to show what had been changed, why it was changed, or the impact on their customers.

Innovation and communication design play a central role in helping customers understand information, navigate key decisions and avoid causing foreseeable harm. Designing communications deliberately - using clear structures, plain language, layering, and accessibility principles - rather than assuming customers will interpret information as intended.

Layering can be an effective way to structure information flows without overwhelming the consumer. For example, some firms found ways to make long and complex documents easier to digest by presenting key information upfront and signposting to wider information. Firms also looked to drip-feed important messaging at the right time to customers throughout the customer journey.  

Clear, simple design that helps customers find key information

Good practice involves prioritising essential information, presenting it upfront, and reducing complexity. Firms use plain language, intuitive layout, visual hierarchy and summaries to guide customers. Content is structured so customers understand the most important points first, with detail layered beneath.

Other examples include simplifying digital journeys, presenting key messages earlier, improving visual hierarchy and testing design changes to confirm improved comprehension.

Simplifying information beyond reducing word count

Effective simplification is not only shortening text but organising it so customers can understand and act on what matters. This may involve short summaries, clear definitions, QR‑linked explanations and clear signposting.

Some firms are using interactive FAQ dropdowns to help customers find information quickly and in a more intuitive way. These ‘clickable FAQs’ and expandable sections allow customers to reveal additional information customers need, reducing the chances of being overwhelmed and helping them understand complex topics step by step. FAQs are there to provide additional narrative to customers and not to replace the need for clearer customer communications.

Some firms are using prompts, tools, and supportive interactive formats

Some firms use calculators, walkthroughs, and reminders to help customers understand processes or build confidence in decisions. These tools are tested to make sure they support comprehension without adding cognitive load.

A firm uses short videos, interactive diagrams, and clickable FAQs to break down complex processes. These tools let customers absorb information at their own pace and make it easier for them to understand key steps or risks.  

A firm is using real-time prompts to stop customers from making common mistakes. These include warnings during payment journeys—such as alerts about potential scams—or messages that explain why certain information is needed. Some firms also use chatbots and virtual assistants to answer questions instantly or guide customers through a journey step by step.  

Positive friction creates short, purposeful pauses in the customer journey that help consumers slow down, reflect, and avoid harmful snap decisions.

These examples show how firms are using simple, practical technology to improve clarity, support customers at important moments, and reduce the chance of errors that could lead to harm.

Designing for accessibility and diverse needs

Research has found that 1 in 7 adults have literacy skills at or below those expected of a 9 to 11-year-old. Our Financial Lives Survey also found 17.7 million adults (34%) have poor or low levels of financial numeracy.  

Firms perform well when they tailor designs for customers with low digital confidence, lower financial capability, sensory impairments, or different communication needs. This includes adapting formats, improving readability, and testing with users who face additional challenges.

Examples include improved colour contrast, alternative formats, meaningful alt‑text, text rewrites, and layouts tested for screen readers. Sometimes communicating in a simplistic way is most effective. 

Data from our Financial Lives Survey (2024) showed 22% of adults lacked confidence managing their money, with 36% having low knowledge about financial matters. If a firm develops communications about a simple mass market product, we expect them to take these characteristics into account and communicate information in as simple a way as possible to support customer understanding.

Practically, this means taking more active steps so that retail customers have the information and support they need, when they need it, to make and act on informed decisions. In turn, this will enable and support consumers to pursue their financial objectives.

More broadly, design features should account for consumers with lower financial capability and characteristics of vulnerability. Where there is a higher concentration of these cohorts, the level of mitigation should be proportionate to the risk.

Proactive identification and tailored support

Firms should take particular care when communicating with consumers in vulnerable circumstances and consider varied needs, accessibility, and digital confidence. Firms should actively design and test communications so vulnerable consumers can understand them. Some firms embedded structural vulnerability assessments at key decision points such as onboarding, renewal, and arrears.  

A firm introduced a short capacity and vulnerability assessment during its onboarding stage and at moments of potential stress, for example, during early signs of payment difficulty. These assessments produced timestamped notes and flags visible to frontline staff.  

Staff then adjusted the firm's communication accordingly to better meet the needs of their customers in vulnerable circumstances. After carrying out several hundred assessments, the firm saw higher engagement and quicker actions from customers, which helped to reduce foreseeable harm.

Accessible 'tell-us-once' systems

Some firms implemented more centralised ways of recording their customers' accessibility needs and preferences (such as communication format, language preference, large print). Those adjustments were then applied consistently across future interactions. Where executed well, this reduced consumer burden and allowed greater attention to be focused on understanding.

Testing with vulnerable cohorts

Some firms regularly tested communications with groups of customers that were representative of the intended recipients.  

Other examples included testing communications with consumers with characteristics of vulnerability. For example, customers with lower digital confidence and capability.  

Typical improvements included simplifying accessibility by reordering content to increase visibility of important information, reducing volume, and adding plain language explanations for complex terms.  

A firm tested all new product communication with a sample of customers in vulnerable circumstances. It captured key insights including comprehension scores, measuring these against its own internal target of at least 80% correct recall of key points. This ensured a greater number of their customers understood the communications.

The firm also reviewed live chat transcripts weekly to identify unclear wording and vulnerability cues. Using a wider range of testing methods helped support consumers in pursuing their financial objectives. This enabled them to have the support they need, when they need it, to make and act on informed decisions.

Communications were then reviewed and redrafted based on customer feedback. This process was repeated until results met the 80% target and was used to influence future design decisions across different channels.

Monitoring outcomes and acting on insights  

Some firms typically monitored outcomes for customers in vulnerable circumstances as a distinct MI category. This meant that they could correctly identify trends sooner, driving focused change and limiting harm to customers.

A firm took a proactive approach by regularly reviewing call and chat transcripts, top complaint reasons and repeated customer contact. Results were presented at quarterly forums where changes would be agreed.

The firm also monitored drop-off rates and ran A/B tests to improve how and when it communicated. Insights from these simple checks highlighted areas where customers faced challenges and led to changes in communication timing and format, reducing confusion and improving customer satisfaction. 

• Reactive rather than proactive: A notable number of firms operate reactively. This lack of preparedness was apparent in vague or underdeveloped policies and processes. It included firms’ approach to identifying consumers with characteristics of vulnerability and those with lower financial capability. This approach increases the risk of poorer outcomes for consumers, particularly for consumers in vulnerable circumstances who have historically been more susceptible to harm.
• Reliance on general knowledge with no proactive mechanisms: Some firms told us that they had ‘considered vulnerability’ but failed to provide details on how this translated into practical changes or measurable outcomes.
• Limited alternative formats and assisted channels: While readability testing was common, several responses under-specified alternative formats (eg, large print, audio, BSL) and assisted channels for customers with low digital capability. This gap created a risk that those most in need of support did not get it.
• One-off initiatives without governance: Some firms described ad-hoc improvements but did not appear to embed them into governance or control frameworks. Without systemic integration into day-to-day operations, it was difficult for firms to show changes would be sustainable or consistently applied.
• Initiatives without results or evidence of what changes: Some firms cited testing they had carried out or referenced new tools they had introduced. But they were not able to show outcomes for customers in vulnerable circumstances. Many firms did not provide comprehension measures, acceptability targets or scaling of initiatives beyond pilot schemes. The lack of data weakened auditability and made it more difficult to evidence improving standards. Firms should be able to evidence that their initiatives support good outcomes and that they do not result in customers, especially those in vulnerable circumstances, being disadvantaged or taken advantage of in a way that is likely to cause detriment. 

We expect firms to design promotions that match their customers’ needs and abilities, including people with low financial confidence or who may be vulnerable.

Ensuring accessibility and fair messaging

Firms performing well avoid jargon, use clear summaries, and make sure core messages remain visible across formats such as mobile, email or social media. Their digital and printed layouts are designed carefully so that important information does not get lost or obscured, even when content is resized or reformatted on different devices. This means customers receive the same clear, balanced information wherever they encounter the promotion, supporting better and more informed decisions.

Monitoring effectiveness and acting on insight

Good practice included firms looking at customer questions, complaints and behaviour to spot where promotions might confuse or mislead. They then use this evidence to rewrite wording, make messages clearer, and highlight key information.

Examples include updating risk warnings when customers seem confused, explaining eligibility more clearly, or simplifying emails that trigger repeated questions.  

Testing promotions to confirm understanding

Good practice includes testing promotions with customers when there’s a risk they could misunderstand or lose out. Testing promotions checks whether people understand key risks, who is eligible and check important limits.

Examples include A/B testing different risk-warning designs, running short understanding surveys, and asking customers to explain the main message in their own words.

Clear approval and governance processes

Some firms use clear evidence-based approval steps, check for plain English and make sure risks and benefits are shown equally. They test promotions before release and keep clear records of how wording and decisions were agreed, with input from different teams.  

One firm used readability checks, approved templates, rules for keeping risks prominent, and a documented sign-off process to stay consistent across all channels.  

A firm tested its promotions with customers, and reworded sections that were confusing, making sure exclusions and key facts were clear before customers committed to the sales journey.

Clear senior responsibility

Good practice included firms assigning explicit responsibility for consumer understanding to the relevant level of seniority. These individuals monitor MI, review customer evidence, assess the impact of communication changes, and make decisions grounded in data rather than assumptions. These firms are also adaptable in their approach and have consumer understanding at the forefront of decision making across their organisations.

Good practice means keeping clear records of decision making, regularly reviewing customer feedback, and following this up through agreed actions. Strong ownership of the consumer understanding outcome helps make sure communication standards stay consistent, embedded across teams, and maintained over time.

Effective governance structures

The firms that had effective governance brought together the right functions including product, operations, customer service, risk, and compliance to review insights, escalate risks, and track outcomes across all products and channels. These firms also had clear terms of reference, structured agendas, and well documented outputs and follow-up items.

Some firms also had designated committees and working groups for the Duty. They met regularly to review evidence, track key performance indicators (KPIs), and made sure issues were escalated promptly while ensuring a cohesive approach across their organisations.  

Embedding consumer understanding into everyday processes

Many firms embed consumer understanding into their routine operations rather than treating it as a standalone compliance task. They review customer interactions regularly, update communications over time, and retest changes to make sure improvements are effective and long-lasting. Some other examples of strong governance included training staff to help customers understand information clearly, such as running short surveys or reviewing call transcripts to identify confusion and then update wording. Firms also introduced simplified escalation processes, so staff could raise issues about unclear or confusing communications without delay.