Tag Archive for: consumer duty act

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Date Confirmed: Regulatory Compliance and Privacy Roundtable

After a very successful inaugural meeting and growing client demand, we’re excited to announce that we have finalised the date for our next Regulatory Compliance and Privacy Roundtable on the 28th of February in London.

During this session, we intend to continue to do a deep dive into how firms are implementing the New Consumer Duty into their business, and also intend to cover Operational Resiliency, PSD3, CCA Reform, Buy-Now-Pay-Later Regulation, Financial Inclusion and Access to Cash, and more.

The roundtable meeting will span over a day and a half and follow an agenda built exclusively from inputs from attendees. After the first day’s meeting, there will also be a group dinner, where attendees will have the opportunity to network amongst their peers.

If you or any of your colleagues are interested in joining this session, please reach out to Nicole Toussaint at nicole.toussaint@auriemma.group.

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Join Auriemma’s Inaugural Regulatory Compliance Roundtable Meeting on Consumer Duty

Consumer Duty is finally here, but how is the financial services industry approaching it?

Join us for our inaugural Regulatory Compliance Roundtable meeting on the 18th of October at the St. Pancras Renaissance Hotel London from 9:30 – 17:00 GMT.

The discussion will be primarily focused on the FCA’s New Consumer Duty Act; however, the group will be open to discussions on other regulatory areas (e.g., BiFD findings, ISO 20022 and early discussions on what the industry would want to see from PSD3).

Our meeting agendas are attendee sourced; however, we expect to cover:

  • Changes already made to processes and procedures
  • Early learnings post 31st July go-live date
  • Focus areas for future changes
  • Internal governance structures
  • Third-party oversight models
  • MI and reporting usage
  • Other regulatory areas of focus

If you or your colleagues are interested in attending, please contact nicole.toussaint@auriemma.group.

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Operational Areas Transforming Under the New Consumer Duty

(London, UK) The Financial Conduct Authority’s (FCA’s) New Consumer Duty went into full effect on the 31st of July 2023. Auriemma  Industry Roundtable members have been eager to collaborate with one another on how the regulation could affect each operational area and on what changes they are prioritising. At each meeting this year, roundtable members shared department-specific plans for tackling Consumer Duty as well as greater, overall objectives.

Collections and Recoveries Roundtable members are aligned in their focus on ensuring their forbearance toolkits are fit for purpose – with 23% of members introducing new forbearance options for struggling customers. Additionally, 54% of members indicated an intent to make changes to their supplier-oversight strategies—another focus area of the regulation.

“Our Customer Service members are hyper focused on communication structure and readability,” says Louis Stevens, Auriemma Industry Roundtables Director, “They are reviewing their entire communications catalogue and leveraging external partners to ensure verbiage meets the average UK reading and numerology levels.” To further ensure comprehension, many are also utilising customer research groups.

Complaints and Disputes departments alike are improving the customer experience around submitting a complaint/claim. They have increased the number of touchpoints to keep customers updated on the progress of their claim, with 15% of roundtable members intending to introduce text message updates as part of their journeys. As with Customer Service teams, 46% also intends to change their communication content, especially with complaints.

Fraud Control Roundtable members are pivoting to track more outcomes-based metrics and building new reporting structures around them. Many members have also recognised the need for Fraud Departments to become more involved in the vulnerable customer journey given that vulnerable customers are often targeted victims of fraud.

When looking at Operations as a whole, roundtable members have common themes within their plans. At the recent Auriemma Consumer Duty Workshop, 92% of members indicated they intend to run new training plans under Consumer Duty with the goal of building awareness amongst the department and delivering pinpointed training on how the regulation will affect individual roles. Outcome testing is a primary focus for many with 70% of firms already having had outcome testing frameworks in place, and the remaining 30% having planned to implement it in the months leading up to the deadline.

“Although it is crucial that the industry makes specific changes to comply with the New Consumer Duty, we must not forget that the intention of this regulation is to trigger a cultural change not just act as a tick-box exercise,” says Stevens. “This is not just a cultural change at the company level either, but rather across the industry as a whole. Collaboration amongst firms is crucial not only to comply with the regulation but to ensure the best possible outcomes for customers.”

To assist in this change, Auriemma is excited to announce its newly launched Regulatory Compliance Roundtable, with the pilot meeting specifically covering Consumer Duty. The agenda will be participant-led but will likely cover early learnings post the go-live date, planned future changes, internal governance structures, third-party oversight models, MI & reporting usage and more.

“We’re really excited for this new group and the enthusiasm we’re already seeing behind it,” says Stevens. “We hope that the group can become an extension of firms’ Consumer Duty teams and help shape the future of how this regulation is successfully implemented within the industry.”

The meeting is scheduled for the 18th of October at the St. Pancras Renaissance Hotel in London. If you or any of your colleagues are interested in attending as our guests, please contact us via roundtables@auriemma.group.

About Auriemma Group

For more than 35 years, Auriemma’s mission has been to empower clients with authoritative data and actionable insights. Our team comprises recognised experts in four primary areas: operational effectiveness, consumer research, co-brand partnerships and corporate finance. Our business intelligence and advisory services give clients access to the data, expertise and tools they need to navigate an increasingly complex environment and maximise their performance. Auriemma serves the consumer financial services ecosystem from our offices in London and New York City. For more information, visit us at www.auriemma.group or contact Louis Stevens at louis.stevens@auriemma.group.

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Consumers More Pessimistic About Financial Health as Cost-of-Living Crisis Intensifies

(London, UK): Consumer expectations for future financial stability is worsening, with many looking to credit cards for support during the cost-of-living crisis. According to Auriemma Group’s latest issue of Cardbeat UK, 37% of cardholders believe their financial health will worsen in the next 6 months.

Gen Z and younger Millennials express greater optimism about their future financial health than their older counterparts despite increased levels of borrowing. Auriemma’s research found that 20% of cardholders are borrowing more to afford everything they need, rising to 32% among Gen Z and Millennials, and 33% of sub- and near-prime customers. The added strain of rising costs will likely cause these figures grow in the coming months.

“Since the start of the pandemic we have seen a resurgence in consumer spending on debit cards and a rise in transfers from savings to current accounts,” says Jaclyn Holmes, Director of Auriemma Research. “Today it appears rising inflation is furthering the strain on consumers, leading some to rely on their credit cards for essential spending.”

According to Auriemma’s latest findings, over 90% of credit cardholders anticipate rising costs of food, housing, fuel or energy bills to impact their personal finances negatively over the next 12 months. While energy prices were capped at £2,500 for 2 years beginning this month, some households may still see their bills double.

“At a time when all other costs are skyrocketing, the price cap will offer little comfort for many households,” says Holmes. “With more monthly outgoings attributed to energy bills, the pressure on credit card usage and borrowing will likely be even higher.”

But consumers aren’t the only ones bracing for impact. Issuers are also trying to assess how the cost-of-living crisis is currently impacting their cardholders and anticipate the enduring impact moving forward.

“Lenders have already begun seeing the operational impact of this change in customer behaviour,” says Louis Stevens, Director of Auriemma’s Industry Roundtables. “This comes at a time where regulatory initiatives, such as The Consumer Duty Act, are already taking up considerable time and resources.”

As issuers likely tighten risk criteria for customers seeking credit, some may turn to Prime and affluent customers for lower-risk lending opportunities. Auriemma Group will continue to monitor this space closely in upcoming Cardbeat studies and within its Customer Service Roundtable groups.

Survey Methodology

This Auriemma Research study was conducted online within the UK by an independent field service provider on behalf of Auriemma from April-May 2022, among 80o+ adult credit cardholders. The number of interviews completed on a monthly basis is sufficient to allow for statistical significance testing between sub-groups at the 95% confidence level ± 5%, unless otherwise noted. The purpose of the research was not disclosed nor did the respondents know the criteria for qualification.

About Auriemma Group

For more than 35 years, Auriemma’s mission has been to empower clients with authoritative data and actionable insights. Our team comprises recognised experts in four primary areas: operational effectiveness, consumer research, co-brand partnerships and corporate finance. Our business intelligence and advisory services give clients access to the data, expertise and tools they need to navigate an increasingly complex environment and maximise their performance. Auriemma serves the consumer financial services ecosystem from our offices in London and New York City. For more information, visit us at www.auriemma.group or call Jaclyn Holmes at +44 (0) 207 629 0075.

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