“Competitive disadvantage not to comply with Consumer Duty”
Will Consumer Duty noticeably change the way companies behave?
Helen Lord Consumer Duty places more onus on regulated firms to consider treatment of customers, not just at the acquisition stage, but throughout the customer life cycle. That will include account management, renegotiation of terms, marketing, product targeting, customer service – right through to collection
Which topics are the most important ones from your point of view?
Helen Lord Consumer Duty makes specific reference to vulnerable customers and the fact that they are more susceptible to harm. It underlines the fact that every effort should be made to identify any vulnerable circumstances and adjust behaviours to achieve the best outcomes. This means that organisations should use available means to identify vulnerability in their customers and from the perspective of VRS, this means that they should be using our database which is a unique source of data with the sole purpose of identifying vulnerability in customers.
Do you think the principle of Consumer Duty will happen across other countries?
Helen Lord Consumer Duty is simply a requirement for firms to treat customers in the right way and it is likely that other countries will mirror the regulation. However, the regulation is only the framework for good customer management that should be embedded.
Do companies and banks that implement Consumer Duty as quickly as possible have a competitive advantage?
Helen Lord It is a regulatory requirement and action will be taken if it is not complied with – at the very least, it would be competitive disadvantage not to comply with Consumer Duty. Consequences could not only involve fines but serious reputational damage. However, there are huge advantages to being compliant – this extends to the social good.
Info: This interview is an excerpt of Perspective Magazine #3 on Customer Centricity.