We set out the final rules and guidance for a new Consumer Duty that will set higher and clearer standards of consumer protection across financial services and require firms to put their customers’ needs first. We also respond to feedback to CP21/36.
A new Consumer Principle that requires firms to act to deliver good outcomes for retail customers.
Cross-cutting rules providing greater clarity on our expectations under the new Principle and helping firms interpret the four outcomes (see below).
Rules relating to the four outcomes we want to see under the Consumer Duty. These represent key elements of the firm-consumer relationship which are instrumental in helping to drive good outcomes for customers.
These outcomes relate to:
products and services
price and value
consumer understanding
consumer support
Our rules require firms to consider the needs, characteristics and objectives of their customers – including those with characteristics of vulnerability – and how they behave, at every stage of the customer journey. As well as acting to deliver good customer outcomes, firms will need to understand and evidence whether those outcomes are being met.
Who this affects
This policy and guidance is likely to interest:
regulated firms, including those in the e-money and payments sector
consumer organisations and individual consumers
industry groups/trade bodies
policy makers and regulatory bodies
industry experts and commentators
academics and think tanks
Next steps
The rules and guidance we are introducing come into force on a phased basis:
for new and existing products or services that are open to sale or renewal the rules come into force on 31 July 2023
for closed products or services, the rules come into force on 31 July 2024
During the implementation period, we'll be hosting a series of industry events to help firms prepare for the new rules coming into force. If you’d like to hear more about future Consumer Duty events and related communications, please sign up for email updates[3].
