The Personal Finance Society (PFS) has published new guidance that consolidates Consumer Duty resources to support firms with evidencing compliance.
Noting the current regulatory environment is ‘characterised by heightened scrutiny and challenge’, the guidance recommends technological solutions to enhance accessibility and improve service delivery. These include the use of software systems to document client reviews, AI to transcribe meetings, and the adoption of robust Customer Relationship Management (CRM) systems.
Existing concepts and templates created by the regulator and professional bodies are also highlighted, such as the FCA’s Retirement Income Advice Assessment Tool (RIAAT), which helps firms understand how they assess retirement income advice. The PFS Consumer Duty toolkit is recommended for management compliance. It provides fair value statement templates for initial and ongoing advice and vulnerable client checklists. The Personal Finance Society Code of Ethics is suggested as a resource for consistent reference, as it requires professionals to act in the best interests of each client.
The report summarises that ‘firms should not have to overhaul the way they work, but complying with new expectations may mean more administrative work. Assessing capacity, whether in staffing or in technological solutions, might be the most appropriate first step’. A review of current files and systems is advised, to ensure that past activity is up to date and client reviews are logged, in order to evidence the value being provided to clients.
The report also explores the topic of complaints management companies (CMCs), citing new data from the Financial Ombudsman Service (FOS) showing that CMCs now account for around half of the complaints the FOS receives in all product categories. It recommends that a complaint should be treated the same ‘regardless of whether it came from an individual directly or through a CMC’.
Carla Brown, president of the PFS, said: “Financial advice firms and professionals have consistently highlighted the time and cost associated with compliance under the Consumer Duty guidelines. The PFS Good Practice Guide on Complying with the Consumer Duty in a New Regulatory Environment aims to support firms by consolidating key resources that will optimise the reporting process, while ensuring best practice.”
