"Customer understanding and support are also part of the outcomes that Consumer Duty seeks to deliver, and this research clearly underlines how important customers think these issues are."
- Paul Glynn, chief executive at Air
Despite the fast-approaching Consumer Duty deadline, new research conducted by Air has revealed that 79% of consumers aged 45+ aren’t aware of the Consumer Duty and a further 38% don’t understand the purpose of the Financial Conduct Authority (FCA) in the UK.
The later life lending platform also found that customer awareness was considerably lower amongst women (17%) compared to men (26%). Likewise, when customers were asked about the FCA, 70% of men understood its purpose compared to 57% of women.
Beyond general awareness, less than 10% of older consumers knew the ramifications of the Consumer Duty on financial services in the UK, while only 3% reported being aware of the specific measures, actions, and requirements proposed within the regulation.
Although consumers have a strong awareness of what a good outcome looks like, only 50% were confident that the Consumer Duty would have a positive impact. Optimism also broadly increased in line with respondents’ incomes, with 62% of those on an annual income of £55k+ believing that the Consumer Duty would have a positive effect, compared to only 47% of those on up to £15k p.a.
Commenting on these findings, Paul Glynn, chief executive at Air, has said:
“While it will come as no surprise to many that the regulatory changes that the industry has been working on for the past year have not hit the radar of most consumers, the standards that they expect from financial services companies are clear and will be delivered by this regulation.
“The need for customers to be protected from fraud and scams is something that the later life lending industry is arguably not only doing but is a step ahead with, due to the use of independent legal advice and a real focus on supporting vulnerability.
“However, the desire for fees and charges to be appropriate and clearly explained goes to the heart of fair value and is something that, as an industry, we need to ensure we listen to. The remuneration that advisers receive needs to be commensurate with the high-quality service provided and we should not be afraid to question the status quo with the objective of providing good customer outcomes.”
