Read our findings on good practice and areas for improvement in payments firms’ approaches to supporting consumers in vulnerable circumstances.
The Consumer Duty[2] (the Duty) sets a high standard for retail consumer protection. We reviewed a sample of payments firms to assess how they are supporting consumers in vulnerable circumstances and whether they are delivering good outcomes.
We found many examples of positive practice but also opportunities for firms to strengthen how they identify vulnerability, monitor outcomes and improve support.
The examples we outline below are intended to help firms learn from the experiences of others. This publication sets out our findings and highlights practices which can help firms to meet their obligations under the Duty and support customers in vulnerable circumstances.
What firms should do now
Firms should consider these findings when assessing whether their own approaches are effective.
This publication does not introduce new requirements or prescribe a particular way to meet our expectations.
Not every example will be relevant to every firm. What is appropriate will depend on the firm's business model, customer base, products and services, and the nature and level of vulnerability within its target market.
Firms have flexibility in how to meet their obligations under the Duty. However, they should be able to show that they:
- understand their customers’ needs
- provide appropriate support
- deliver good outcomes
Why this matters
Payments are essential to everyday life in the UK, enabling consumers to receive, store and move money. They are not just a convenience; they are how consumers access their money and manage their day-to-day lives.
It’s important that payments work reliably for all consumers, particularly as around half of UK adults show at least 1 characteristic of vulnerability. This means a significant proportion of consumers may be less resilient when things go wrong. This could include:
- being unable to access funds
- missing essential payments
- experiencing financial stress
Even small failures can escalate quickly and, while frustrating for all, they can affect consumers in vulnerable circumstances most.
When business models rely on digital or transactional interactions, this can amplify the potential for harm. Consumers may then have limited opportunities to speak to a person directly.
Who this applies to
This will interest:
- payments and e‑money firms serving retail customers (including micro‑enterprises and small charities)
- firms distributing payments, e-money and open banking products and services to consumers via intermediaries
- trade bodies, policymakers and consumer groups
- retail banks
What we found
Firms delivering the strongest outcomes:
- Had a clear understanding of characteristics of vulnerability within their customer base.
- Effectively identified and recorded consumers in vulnerable circumstances to support staff in responding to their needs.
- Provided appropriate and consistent support tailored to customer needs.
- Defined, monitored and assessed customer outcomes.
- Used management information and governance arrangements to oversee performance and drive improvements.
- Continuously reviewed and enhanced their approach over time.
The strongest firms focused on the characteristics of vulnerability most relevant to their customer base and understood the needs of their consumers. However, they remained flexible enough to support customers with other needs. They took account of the 4 drivers of vulnerability set out in our guidance for firms on the fair treatment of vulnerable customers[3]:
- health
- life events
- financial resilience
- financial capability
They could also show that policies and processes were working effectively.
They understood the needs of the consumers they served, including where some customer groups may face barriers such as digital exclusion, limited financial resilience or difficulties accessing traditional financial services.
There is no one-size-fits-all approach. Although firms can be flexible in how they meet their obligations under the Duty, they should be able to show that they:
- understand customers’ needs
- provide appropriate support
- deliver good outcomes in practice
We also identified opportunities for firms to strengthen their arrangements. In particular, we found firms could improve by:
- enhanced testing and assurance to show that policies are operating effectively
- more developed management information and outcomes monitoring
- greater consistency in the delivery of support
- stronger oversight of intermediaries
Considerations for smaller firms
We expect all firms to provide effective support to consumers in vulnerable circumstances in a way that meets their needs.
For smaller firms, this does not necessarily require complex systems or extensive processes. However, firms should be able to show their approach is proportionate to their business model, customer base and the potential risk of harm.
Firms with a clear understanding of the scale and nature of vulnerability in their customer base were better able to target support effectively. They were able to focus on the needs and risks most relevant to their products, services and customer journeys, while remaining flexible enough to respond to individual circumstances.
Having assessed the scale and nature of vulnerability in their customer base, these firms were then able to focus their approach on the needs and risks most relevant to their customers. For example, some firms placed particular emphasis on supporting customers experiencing financial difficulty or low financial resilience, while others focused on addressing barriers such as limited digital capability or language needs.
Identifying and recording consumers in vulnerable circumstances
Good practice
Firms delivering good outcomes:
- Understand the scale and nature of vulnerability in their customer base.
- Identify common vulnerability drivers (such as financial resilience or digital exclusion).
- Embed identification across customer journeys, including online and automated channels.
- Consistently record vulnerability using system flags in their customer management computer systems.
Select a tab below for examples of good practice.
Actively prompting customers to disclose support needs
Some firms included questions in online application journeys about areas where customers may need additional support, rather than explicitly asking about vulnerability.
Using data and interaction signals to identify potential vulnerability
Some firms, for example, trained call handlers to recognise indicators such as:
- limited English language skills
- hearing difficulties
- low digital capability
Testing identification processes
Some firms tested whether their processes are working in practice, through:
- call listening
- complaints monitoring
- quality assurance testing
Using technology to support identification
Some firms piloted tools to analyse customer language in online chats and routed customers who may be in vulnerable circumstances to human agents.
These approaches support early identification and more effective intervention, improving outcomes for customers.
When recording sensitive personal information about customers in vulnerable circumstances, we expect firms to comply with applicable data protection requirements.
Areas for improvement
Some firms:
- Had policies and training in place but were not always able to show how these were working in practice.
- Identified very few, or in some cases no customers in vulnerable circumstances, despite having customer bases where characteristics of vulnerability may reasonably be expected.
Could enhance the consistency of their vulnerability recording processes.
In some cases, we saw that:
- Firms relied heavily on staff judgement with limited supporting processes to promote consistent identification of vulnerability.
- There was limited testing or assurance to assess how effectively policies were being implemented in practice.
- Firms could not consistently evidence how vulnerability information was recorded and shared across the customer journey.
Strengthening these areas can help firms build a more complete understanding of vulnerability within their customer base and make sure consumers get appropriate and consistent support.
Considerations for smaller firms
Smaller firms may not need complex systems but still need to identify customers in vulnerable circumstances effectively.
If firms interact with customers mainly online or through transactions, they should use proportionate processes to identify characteristics of vulnerability.
Supporting consumers in vulnerable circumstances
The support a firm provides should reflect its activities, role in the customer journey, level of customer interaction and the risk of harm.
Firms providing payments services through intermediaries should see the section below.
Good practice
Firms delivering good outcomes:
- Design support around the needs identified in their customer base and customer journeys.
- Offer flexibility (such as time, channels or communication formats).
- Make sure support is applied consistently, not dependent on individual staff interactions.
For example:
- A payments and e‑money provider offered tailored support to customers with limited IT skills, including assisted onboarding and alternative channels.
- A money remitter provided customer support in relevant languages to help customers where English was not their first language.
Some firms also:
- Tested and refined support approaches. For example, trialling different support options with customers before scaling the most effective ones.
- Provided training and guidance to intermediaries’ staff.
These firms were better able to deliver consistent support, improve customer experiences and reduce the risk of harm.
Areas for improvement
Some firms:
- Could provide clearer evidence of how their support arrangements are achieving good outcomes.
- Relied on approaches that were not always applied consistently across the customer journey.
- Could better show how they use vulnerability information to support customers.
In some cases:
- Firms focused on specific characteristics of vulnerability without clearly explaining how these reflected the needs of their customer base or how they informed customer outcomes.
- There was limited evidence showing how identified characteristics of vulnerability translated into tailored support.
Our findings suggest that firms are best placed to deliver consistent and effective support where they identify vulnerability early, understand needs clearly, and link needs to appropriate actions and customer outcomes. For example, tailored support, adapted communications and alternative contact routes.
Considerations for smaller firms
Smaller firms can take a proportionate approach. But they should:
- Understand the needs of their customers.
- Identify where additional support may be needed.
- Respond appropriately to individual circumstances.
This is supported by a clear understanding of vulnerability and active senior oversight. For example, one firm providing payment services to small businesses identified limited IT literacy as a key vulnerability and arranged call back support to help customers set up and manage their accounts.
Consumer understanding and communications
Good practice
Firms delivering good outcomes:
- Communicate in ways that are clear, accessible and appropriate for their customers.
- Tailor communications for customers in vulnerable circumstances.
- Use different formats and channels to support understanding.
- Test communications to make sure they are effective and support informed decision making.
For example, some firms:
- Adapted communications for UK-based customers where English was not their first language. They also offered alternative channels and additional support for customers with limited digital capability.
- Tested communications with customers in vulnerable circumstances to make sure key information is shared and explained appropriately.
- Sought feedback from customers in vulnerable circumstances, consumer panels and advocacy groups to better understand customer needs and test whether support arrangements were effective.
Areas for improvement
Some firms:
- Relied primarily on standard communications, with limited tailoring for customers with different needs.
- Could do more to assess whether communications are understood and effective in practice.
- Offered limited flexibility in how customers can engage with the firm.
Strengthening these areas can help firms better support customer understanding, enabling customers to make informed decisions and achieve good outcomes.
Considerations for smaller firms
Smaller firms may take a proportionate approach to communications, but should make sure these remain clear, accessible and appropriate for their customers. This may include:
- using simple language
- offering alternative channels where needed
- making reasonable adjustments for customers in vulnerable circumstances
For instance, several money remitters offered multi-lingual support to customers online and in some cases by phone.
Governance, management information (MI) and outcomes monitoring
Good practice
Firms delivering good outcomes:
- Define what ‘good outcomes’ look like for customers with different needs.
- Collect and analyse MI on:
- number and characteristics of vulnerability
- outcomes experienced by customers
- Provide regular reporting to senior management and boards.
- Use MI to identify issues, carry out root-cause analysis and drive improvements.
- Take a structured approach to continuous improvement and monitor whether changes lead to improved outcomes.
- Use insights from customer interactions, complaints, quality assurance activity and MI.
- Adapt their approach over time.
- Embed learning across the organisation.
For example, some firms:
- Provided regular board MI on the prevalence of characteristics of vulnerability, showing increased accountability.
- Included metrics for outcomes for customers in vulnerable circumstances and case examples within Duty MI aligned to the 4 outcomes.
- Used MI to identify where customers were experiencing poor outcomes and took action to address these.
- Analysed trends in complaints and vulnerability and refined their approaches to support.
- Piloted new ways of supporting customers and scaled the effective ones.
- Used MI and outcome testing to assess whether interventions improved customer outcomes.
Areas for improvement
Some firms:
- Could improve the frequency and quality of MI provided to senior management and boards.
- Could do more to monitor outcomes for customers in vulnerable circumstances.
- Had opportunities to enhance senior management oversight and challenge in this area.
- Relied primarily on individual examples rather than broader analysis of outcomes and trends.
- Could further develop how they assess the effectiveness of actions taken.
- Could build more structured approaches for reviewing and refining their arrangements over time.
In some cases:
- Firms had identified few or no customers in vulnerable circumstances, limiting the MI available.
- Boards received limited insight beyond annual Duty reporting.
- Vulnerability data and outcomes information was not consistently recorded, reducing firms’ ability to identify trends and opportunities for improvement.
Strengthening these areas can help firms gain better insight into customer outcomes, identify emerging issues earlier and support a culture of continuous improvement.
Considerations for smaller firms
Smaller firms may adopt a proportionate approach to MI and governance, including using more qualitative reporting. However, boards should still receive enough insight to oversee their firm’s delivery of good outcomes.
For instance, some firms regularly update their board and senior management on the number of customers in vulnerable circumstances and types of vulnerabilities in their customer base. They also link this to their complaints data and Duty outcomes. This has helped them identify where they are delivering good outcomes and opportunities for improvement.
Overseeing intermediaries
In some payments and e-money business models, firms may distribute products and services through intermediaries.
Where this happens, firms should take reasonable steps to understand how distribution arrangements may affect customer outcomes. They should also maintain appropriate oversight of matters relevant to their own products, services and obligations under the Duty.
Good practice
Firms with effective oversight:
- Use information from intermediaries and other sources to understand outcomes for customers in vulnerable circumstances.
- Provide guidance and challenge where needed.
- Collect MI on intermediary performance.
- Take action where they identify issues.
For example, some firms:
- Monitored complaints and outcomes for customers served via intermediaries.
- Provided training to intermediaries’ staff on how to identify and support customers in vulnerable circumstances.
- Used MI to assess intermediary performance and drive improvements.
Areas for improvement
Some firms:
- Could enhance their oversight of intermediary activities and customer outcomes.
- Had limited evidence of how outcomes for customers served through third parties were being monitored.
In some cases:
- Firms had limited visibility of vulnerability within customer groups served by intermediaries.
- There were opportunities for greater engagement with intermediaries to support good customer outcomes.
Given the important role intermediaries can play in the customer journey, firms should take reasonable steps to understand the impact of their distribution arrangements on customer outcomes. This can help firms identify opportunities for improvement while recognising that both providers and intermediaries have responsibilities under the Duty.
Considerations for smaller firms
Firms should apply proportionate oversight based on their business model and risk. This means firms should keep enough oversight of outcomes and step in where improvement is needed.
For instance, some firms work closely with their intermediaries, providing training, feedback and additional support and, where necessary, off-boarding intermediaries who are not meeting expectations.
Next steps
We expect firms to comply with the Duty and our guidance on the fair treatment of vulnerable customers.
Firms should consider the findings and examples in this publication when assessing their own arrangements. This can help identify any improvements needed to deliver good outcomes for customers in vulnerable circumstances.
We'll continue to engage with firms in this area. Where we find firms are not meeting expectations, we’ll intervene using our full range of supervisory tools.