"How can enhancing elements of the advice process, such as communication, compliance, and efficiency, help advisers to comply with the new regulation"
Good customer outcomes are now at the forefront of every broker’s mind. By the end of July, we will hit the next milestone, and enter a new era for the mortgage industry as Consumer Duty requirements come into full swing. As this transition unfolds, many advisers are not only questioning how they can best comply with the regulation, but also what they can do to ensure the effort is continued post-deadline.
The consumer understanding outcome of the Consumer Duty means that brokers must do everything in their power to prevent a poor consumer outcome. Typically, this is achieved by ensuring that the information customers are provided with is clear, concise, and personalised, and is also used to make an informed decision about the most suitable products available to them on the market. With so many considerations at hand, technology can play a key role in supporting brokers to offer quality advice to their customers. So how can enhancing elements of the advice process, such as communication, compliance, and efficiency, help advisers to comply with the new regulation and maintain momentum following its implementation?
Enhancing communication for better customer outcomes
A key part of fostering good customer outcomes under the Consumer Duty involves effective communication, and giving customers the information they need, at the right time, presented in a way they understand. Clear communication is particularly important during this period of changing product and interest rates, as borrowers may be feeling confused or overwhelmed when remortgaging or buying a new property. Technology can enhance communications to give your customer the best possible outcome. For example, technological tools such as a mortgage resource and sourcing platforms can provide accurate information to support customers’ queries on changing rates, so the broker spends less time on research, and reserves more time to advise and reassure their customers.
In addition to cutting research time, mortgage technology also has a significant role to play in shrinking the size of brokers’ paper stacks by using digital solutions that eliminate the need for lengthy forms and repetitive paperwork. When a large proportion of the admin work is automated, or removed completely, advisers can keep their focus on building and maintaining relationships with their customers, and therefore, facilitating better outcomes.
Keeping up with compliance
Another key way that technology can support brokers during the transition towards the new regulatory landscape is via compliance documents. Through platforms like Legal & General Ignite, brokers can easily access and download key compliance documents, ensuring that all the necessary resources are available to them. Indeed, being able to download and access compliance documents such as your client’s ESIS and evidence of research directly from the system whenever needed, is vital in helping advisers meet their compliance needs.
Quality data over quantity
Customer outcomes must be monitored and evidenced, and this cannot be achieved without data. Firms collect data across multiple touchpoints within the mortgage journey already, so this doesn’t immediately require a complete overhaul of strategy, rather, firms should be making use of the data they already have. A small amount of quality data is far more valuable when it comes to evidencing customer outcomes than a high volume of data that is irrelevant.
What’s more, access to such data can not only act as direct evidence, but they can also give firms an opportunity to evaluate processes within their business and identify where development is needed. This could involve increased training programmes, or efficiency improvements, that help their brokers to ensure fairer customer outcomes.
The combination of technology and human input is the key to compliance under the Consumer Duty, and brokers integrating the technology tools available to them into their existing strategies will be vital in navigating the changing regulatory landscape. The Consumer Duty is here to stay, and with mortgage professionals and technology working together in harmony, the sector will present new opportunities for increased contact time with clients, and more suitable outcomes for individual customer needs.
