In July 2022, the Financial Conduct Authority (FCA) set out the final rules and guidance for a new Consumer Duty; forming the cornerstone of its three-year strategy and a key element of its work to set and test higher standards.
But what does it mean?
Put simply, Consumer Duty – which comes into force on 31 July 2023 – aims to set higher and clearer standards of consumer protection across financial services and requires firms to act so they deliver good outcomes for their customers. To achieve this the Duty lays out four outcomes that firms must take action to meet: products and services, price and value, consumer understanding and consumer support.
In principle it’s a good idea. After all, who doesn’t want to deliver good outcomes for customers? Yet, in practice, the road forward is far from clear meaning help and support is needed to ensure firms can deliver those good outcomes.
The sheer volume of reporting and analysis now required means both asset and wealth managers need a simplified, standardised and digitised solution to meet this challenge.
It's where FE fundinfo and its new partner organisation, Door, come in.
Meeting the challenge
Through the partnership, a streamlined, standard solution to the new requirement has been produced to provide a helping hand.
That helping hand has been achieved through the powerful combination of FE fundinfo’s data provision and Door’s existing information gathering and reporting tools which help fund managers and fund distributors streamline the due diligence process.
The end result of which has manifested itself in the shape of a Consumer Duty Question Set – built by Door – that covers all four outcomes of the Duty. This Question Set utilises data points pulled directly from FE fundinfo’s existing fund data, which includes content from standardised industry data templates.
To build this, Door have leveraged their existing infrastructure and technology and further built this out to support the new data set – as well as the flag reporting tools – for responses. With data automation from FE fundinfo, managers can now, more easily, provide Consumer Duty data to their clients.
How it works
As already mentioned, Door has leveraged its own systems that it already has in place to build a solution that can support the processes asset manager and wealth management firms are creating to meet Consumer Duty requirements.
It will then allow them to do several things including:
- Helping distributors request Consumer Duty information from their providers;
- Allowing users to flag all responses and highlighting problem products and managers;
- Containing content in one central repository that is fully searchable and comparable;
- Allowing manufacturers to respond at scale to Consumer Duty questions, leveraging complete content;
- Providing response automation in partnership with FE fundinfo; and
- Provide a means – come July – for questions to be issued back to distributors.
Without sounding like we’re blowing our own trumpets too much; the solution could be a game-changer for the industry.
As firms continue to research and find out more about what they need to produce to meet the requirements of the new Duty, any solution that helps steer them towards an answer should be welcomed by industry participants as a useful tool to have at their disposal; especially with the FCA expecting them to share information and work closely with their commercial partners going forward.
Combining our data sets with Door will enable our mutual clients to meet Consumer Duty requirements easily and efficiently and help smooth the road and create a simplified reporting outcome.
Steven Kennedy, Senior PR Manager, FE fundinfo