The Consumer Duty is central to our ‘Putting Consumers’ Needs First’ strategic commitment. It sets a higher expectation for the standard of care that firms give consumers. As firms embed the Duty, this will have a positive impact on consumer outcomes.
The Duty came into force on 31 July 2023 for new/existing products and services and is due to come into force on 31 July 2024 for closed products and services.
The positive impacts of the Duty are likely to take time to feed through to consumer outcome metrics, particularly for reduced complaints which are a lagging indicator. Alongside the Duty we have undertaken a wider programme of work to support firms in putting consumers’ needs first, set out in more detail in the annual report. Over time, we expect to see these interventions influence our metrics. Although we have already seen some positive movements in complaints and some consumer perceptions, we continue to see some negative indications around price and value, which may also be affected by the wider environment. This is a strong focus of our ongoing work under the Duty.
Suitability and treatment
Outcome 1: Consumers are sold products and services that are designed to meet their needs and characteristics
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Metric code |
Metric description |
Source |
Baseline Value |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF1-M01
This metric uses the same data as topline metric CST1-M02 |
Reduction over time in upheld Financial Ombudsman Service complaints about unsuitable advice or mis-sold products and services |
FCA analysis of Financial Ombudsman Service
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19,965 Upheld complaints (including PPI) 35% Uphold rate (2021) |
10,106 Upheld complaints (including PPI) 39% Uphold rate (2022) |
7,989 Upheld complaints (including PPI) 33% Uphold rate (2023) |
Improved |
|
15,159 Upheld complaints (excluding PPI) 48% Uphold rate (2021) |
9,679 Upheld complaints (excluding PPI) 40% Uphold rate (2022) |
7,671 Upheld complaints (excluding PPI) 32% Uphold rate (2023) |
Improved |
Fair value
Outcome 2: Consumers get products and services which are fair value
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Metric code |
Metric description |
Source |
Baseline Value(s) |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF2-M01 |
Reduction over time in upheld Financial Ombudsman Service complaints about charges, fees and commission and premium pricing |
2785 upheld complaints, 32% uphold rate (2021) (complaints with any event date)
|
2241 upheld complaints, 32% uphold rate (2022) (complaints with any event date)
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1249 upheld complaints, 27% uphold rate (2023) (complaints with any event date)
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Improved |
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1375 upheld complaints, 28% uphold rate (2021) (complaints with event date in 2020 or 2021)
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1032 upheld complaints, 26% uphold rate (2022) (complaints with event date in 2021 or 2022)
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776 upheld complaints, 24% uphold rate (2023) (complaints with event date in 2022 or 2023) |
Improved |
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CNF2-M02
This metric uses the same data as topline metric CFV1-M01 |
Reduction in the proportion of consumers, including those in vulnerable circumstances, who, in the last 2 years, have been offered a financial product or service they wanted, but at a price, or with terms and conditions, they felt to be ‘completely unreasonable’. We use ‘completely unreasonable’ as it is the question wording in the survey; it doesn’t represent a threshold of what we perceive as fair. We also recognise that the question is asking consumers about their experiences in the past 2 years, so it will take time to show any changes that result from our work.
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FCA Financial Lives Survey (FLS)
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7% of consumers (8% vulnerable, 5% not vulnerable (2020) |
10% of consumers (10% vulnerable, 9% not vulnerable) (2022)
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13% of consumers (14% vulnerable, 12% not vulnerable) (2023 re-contact Survey) Differences between year 2 and baseline values are statistically significant.
|
Declined |
Suitability and treatment
Outcome 3: Consumers understand the information they are given and make timely and informed decisions as a result
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Metric code |
Metric description |
Source |
Baseline Value(s) |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF3-M01 |
Consumer perceptions of the information they’re given about products and services. |
We have added a question to the Financial Lives survey. The results will be available by the end of 2024. The results will provide a baseline value. |
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Outcome 4: Firms provide consumers with good customer support
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Metric code |
Metric description |
Source |
Baseline |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF4-M01 |
Reduction over time in upheld Financial Ombudsman Service complaints about administration or customer service, account access, delays and terminations, account closure, cancellation of policies
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12,830 upheld complaints 32% uphold rate (2021) (complaints with ay event date)
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13,092 upheld complaints 33% uphold rate (2022) (Complaints with any event date)
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14,931 upheld complaints 37% uphold rate (2023). (Complaints with any event date) |
Declined |
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9,668 upheld complaints 32% uphold rate (2021) (Complaints with event date in 2020 or 2021)
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9,026 upheld complaints 32% uphold rate (2022) (complaints with event dates in 2021 or 2022)
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12,021 upheld complaints 37% uphold rate (2023) (complaints with event dates in 2022 or 2023) |
Declined |
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CNF4-M02 |
Maintain or reduce the proportion of consumers (with product(s) in that sector), including those in vulnerable circumstances, who have had a customer service related problem with that product in the last 12 months involving: sales pressure (for consumer credit: pressure to take on additional credit), poor customer service, IT system failure/service disruption, provider errors/not following instructions, delays when making changes to an account, delays when arranging an account, and/ or unsuitable channel (phone, online, face to face) to contact the provider |
Retail banking (day-to-day accounts) -12% (vulnerable 13%, not vulnerable 11%) (2020) |
Retail banking (day-to-day account) – 10%(vulnerable 11%, not vulnerable 9%) (2022) |
Retail banking (day-to-day account) – 17% (vulnerable 21%, not vulnerable 14%) (2023 re-contact survey) Differences between year 2 and baseline values are statistically significant. |
Declined |
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Mortgages - 6% (vulnerable 7%, not vulnerable 6%) (2020) |
Mortgages – 6% (vulnerable 8%, not vulnerable 5%) (2022)
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Mortgages – 6% (vulnerable 8%, not vulnerable 5%) (2023 re-contact survey) Differences between year 2 and baseline values are not statistically significant. |
Little or No change |
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Credit and Loans- 11% (vulnerable 14%, not vulnerable 8%) (2020) |
Credit and Loans– 10% (vulnerable 14%, not vulnerable 8%) (2022)
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Credit and Loans– 8% (vulnerable 11%, not vulnerable 5%) (2023 re-contact survey) Differences between year 2 and baseline values are statistically significant.
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Improved
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General insurance and protection – 8% (vulnerable 9%, not vulnerable 7%) (2020)
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General insurance & protection – 7% (vulnerable 8%, not vulnerable 6%) (2022)
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General insurance & protection – 8% (vulnerable 10%, not vulnerable 6%) (2023 re-contact survey Differences between year 2 and baseline values are not statistically significant.
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Little or no change
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DC pension in accumulation - 6% (vulnerable 7%, not vulnerable 5%) (2020)
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DC pension in accumulation – 5% (vulnerable 7%, not vulnerable 4%) (2022)
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DC pension in accumulation – 8% (vulnerable 8%, not vulnerable 7%) (2023 re-contact survey) Differences between year 2 and baseline values for all customers and those with no characteristics of vulnerability are statistically significant. Difference between year 2 and baseline value for consumers with at least one characteristic of vulnerability is not statistically significant.
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Declined
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DC pension decumulation - 8% (vulnerable 10%, not vulnerable 6%) (2020)
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DC pension decumulation – 9% (vulnerable 10%, not vulnerable 8%) (2022)
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DC pension decumulation – 13% (vulnerable 20%, not vulnerable 8%) (2023 re-contact survey) Differences between year 2 and baseline values for all consumers and those with at least one characteristic of vulnerability are statistically significant. Difference between year 2 and baseline value for consumers with no characteristics of vulnerability is not statistically significant.
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Declined
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Savings products- 6% (vulnerable 7%, not vulnerable 5%) (2020)
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Savings products – 7% (vulnerable 9%, not vulnerable 5%) (2022)
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Savings products – 9% (vulnerable 11%, not vulnerable 7%) (2023 re-contact survey) Differences between year 2 and baseline values are statistically significant.
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Declined
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Consumer investments - 12% (vulnerable 13%, not vulnerable 11% (2020) |
Consumer investments – 11% (vulnerable 13%, not vulnerable 10%) (2022) |
Consumer investments – 8% (vulnerable 13%, not vulnerable 6%) (2023 re-contact survey) Differences between year 2 and baseline values for all consumers and those with no characteristics of vulnerability are statistically significant. Difference between year 2 and baseline value for consumers with at least one characteristic of vulnerability is not statistically significant.
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Improved
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Confidence
Outcome 5: Consumers have confidence in financial services markets
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Metric code |
Metric description |
Source |
Baseline Value(s) |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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This metric uses the same data as topline metric CCO1-M01 and metric PFS1-M01 under the Preparing Financial Services for the future commitment |
Increase in the proportion of consumers, including consumers in vulnerable circumstances, who slightly or strongly agree that they have confidence in the UK financial services industry |
41% of consumers (35% vulnerable, 47% not vulnerable) (2020) |
41% of consumers (33% vulnerable, 49% not vulnerable) (2022) |
43% of consumers (34% vulnerable, 50% not vulnerable) (2023 re-contact survey) Differences between year 2 and baseline values are statistically significant. Difference between year 2 and baseline values for consumers with at least one characteristic of vulnerability is not statistically significant. |
Improved |
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CNF5-M02 |
Increase the proportion of consumers, including consumers in vulnerable circumstances, who slightly or strongly agree that most financial firms are honest and transparent in the way they treat them |
34% of consumers (29% vulnerable, 39% not vulnerable) (2020) |
36% of consumers (29% vulnerable, 41% not vulnerable) (2022) |
36% of consumers (29% vulnerable, 41% not vulnerable) (2023 re-contact survey) Differences between year 2 and baseline values for all consumers and those without any characteristics of vulnerability statistically significant. Difference between year 2 and baseline values for consumers with at least one characteristic of vulnerability is not statistically significant. |
Improved |
Access
Outcome 6: Appropriate access to financial services is maintained
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Metric code |
Metric description |
Source |
Baseline Value(s) |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF6-M01
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Continued tracking of access to cash given our new statutory powers. |
Source: FCA and PSR data request |
Access to any bank, building society, Post Office branch, or any ATM (either free or pay-to-use): 95.7% of the UK population are currently within 2km of a cash access point (2021, Q3) Access to cash coverage in the UK 2021 Q3Access to cash coverage in the UK 2021 Q3 |
Access to any bank, building society, Post Office branch, or any ATM (either free or pay-to-use): 96.5% of the UK population are currently within 2km of a cash access point |
Access to any bank, building society, Post Office branch, or any ATM (either free or pay-to-use): 95.1% the UK population are currently within 1 mile of a cash access point |
Not assessed |
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99.7% of the UK population are currently within 5km of a cash access point (2021, Q3) |
99.8% of the UK population are currently within 5km of a cash access point |
99.7% of the UK population are currently within 3 miles of a cash access point |
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Suitability and Treatment
Outcome 7: Firms support consumers to sustainably manage their debts
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Metric code |
Metric description |
Source |
Baseline Value(s) |
Year 1 values |
Year 2 values |
Latest status (year 2 value compared to baseline) |
|---|---|---|---|---|---|---|
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CNF7-M01 |
The uphold rate of Financial Ombudsman Service complaints about the treatment of customers experiencing financial difficulties is maintained or reduced |
32% uphold rate (278 upheld complaints) (2020) 35% uphold rate (548 upheld complaints) (2021)
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24% uphold rate (475 upheld complaints) (2022)
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27% uphold rate (412 upheld complaints) (2023) |
Improved |
What the latest metric values tell us
Metric CNF1-M01 measures the average proportion of upheld Financial Ombudsman complaints for recent events about unsuitable advice or mis-sold products and services. This metric has decreased.
It is too early to identify any trend from the data, but this reduction could have been influenced by our previous interventions on PPI mis-selling, resulting in firms being less likely to mis-sell.
Together with the Consumer Duty, we expect our increased interventions to tackle mis-leading or unclear financial promotions will have a positive effect over time, reducing the number of these complaints upheld.
The proportion of upheld Financial Ombudsman complaints from recent events about:
- charges
- fees
- commissions (metric CNF2-M01)
remained similar.
However, when surveyed in Financial Lives Survey 2023 recontact survey (metric CNF2-M02), there was an increase in consumers stating that they had been offered a product or service in the last 2 years at a price or with terms and conditions they felt were ‘completely unreasonable’.
This may have been affected by cost-of-living pressures and resulting perceptions of fair value. We will monitor these metrics to assess the impact of the Consumer Duty in delivering good outcomes specifically on price and value.
For customer service and support, compared to the baseline values, the latest data doesn’t show a substantial change in the proportion of upheld complaints (metric CNF4-M01). However, there are some changes to the proportion of consumers telling us they have had customer service-related problems (metric CNF4-M02). Higher proportions of consumers have had these problems with their day-to-day accounts, savings accounts, consumer investments or their DC pensions (in accumulation or decumulation) in 2023 than in 2020.
We will monitor these metrics to assess the impact of the Consumer Duty specifically on customer support.
Consumers’ confidence in financial services overall has improved. Perceptions of financial firms’ honesty and transparency in the way they treat have also improved when surveyed in 2023 compared to 2020 baseline (metrics CNF5-M01 and CNF5-M02).
This highlights the importance of firms fully embedding the Duty swiftly. We also expect our work to make sure firms support consumers to sustainably manage their debts will help with the impact of the cost-of-living for those in difficulty.
For metric CNF6-M01, our data shows that most people currently have reasonable access to cash through a combination of bank, building society, or Post Office branches and ATMs.
We will use the new powers granted through FSMA 2023 for the purpose of seeking to ensure reasonable provision of cash access. We’ll continue to work with government and wider partners to support financial inclusion in financial services. We’ll use our new powers under FSMA 2023 to seek to ensure reasonable access to cash and continue to work towards the outcome of maintaining appropriate access to financial services and measure progress towards this (metric CNF6-M01).