Protecting vulnerable customers, who may be at greater risk of harm is a key priority for the FCA. Here we present the FCA's guidance on the treatment of vulnerable clients along with examples of Fidelity's approach to supporting these customers.
The Consumer Duty has recently imposed additional rules and guidance on how vulnerable customers should be treated. In this video, Paul Richards talks to Andy Harrison, who is responsible for ensuring the fair treatment of vulnerable customers at Fidelity, about the practical steps advice firms can take to ensure good outcomes for these clients.
14-min watchThe FCA have issued guidance to firms around the fair treatment of vulnerable customers, to ensure they receive outcomes as good as other customers and get consistently fair treatment. You can read more about the FCA’s expectations in our high-level summary of the regulator’s guidance to firms.
Summary of the FCA’s Finalised Guidance (FG21/1)
In short, the FCA’s guidance falls in the following areas:
With the introduction of the Consumer Duty regulations, which overlap and enhance the FCA’s expectations on how all customers are treated, you may wish to familiarise yourselves with the regulator’s guidelines.
You can also take a look at our Consumer Duty Hub which includes our guide to the Consumer Duty, a webinar which discusses the key changes you need to make plus other data to support this regulatory change.
The FCA require that all firms ensure the fair treatment of customers in vulnerable circumstances. As such, they have suggested some key areas to focus on. Below we have detailed how we approach these areas and include suggestions on how you can support your clients:
At Fidelity
We use data like the FCA’s Financial Lives survey to inform the nature and extent of vulnerabilities present in our customer base. We can then understand what additional needs some of our customers may require. We encourage customers to disclose their circumstances to us so that we can provide additional support where needed.
Adviser firm
We suggest identifying your target market and considering what support needs some of your customers may have. Some vulnerabilities may be more likely in groups of customers that share characteristics. For example, older customer segments will include a higher proportion of experienced investors but also more customers with age-related health conditions. Younger customer segments will almost exclusively prefer digital options but will include a higher proportion of inexperienced investors.
At Fidelity
All of our colleagues, irrespective of whether they are client facing or not, have attended training on supporting customers in vulnerable situations. All client-facing colleagues have been through enhanced training. We also have dedicated vulnerable customer champions to help support or take over more complex calls as necessary.
Adviser firm
You may wish to think about the following:
At Fidelity
All of our products have been assessed against a value-for-money framework that considers the impact on customers in vulnerable situations applicable to the target market. Products and associated literature and other content are checked to be clear, concise and in plain easy-to-understand language, paying attention to anything that could be deemed as difficult for vulnerable customers to digest, and changed as necessary.
We regularly work with our customers in focus groups when designing new products and important communications.
We work with internal and external subject matter experts to understand what is needed and adapt as necessary.
Adviser firm
Consider any specific needs of vulnerable customers when recommending any product or service, particularly in terms of their understanding. You should look to evidence how you are supporting vulnerabilities.
At Fidelity
Our vulnerable customer champions sit within our Client Services and Operational teams to act swiftly to support vulnerable customers and colleagues as necessary. We have updated our technology to be able to identify vulnerable customers so that their needs are met as soon as they make contact with us. We can adapt our service offering, service provision and communications as needed.
Adviser firm
We suggest that you ensure a customer-centric culture is in place that supports all customers and their needs. All staff should have sufficient training. For example, consider offering a safe space in branch where clients feel comfortable to talk about any vulnerability they may be experiencing.
At Fidelity
We endeavour to make all of our content easy to follow in plain simple text avoiding layout issues that could make them hard to digest and understand. We are committed to removing technical jargon.
Our communications can be accessed in a wide variety of ways including large print, braille and audio CD. We can also provide documents to help our clients who are neurodiverse and benefit from documents being formatted on a different background colour, with tinted overlays, colour text and various fonts and size.
Adviser firm
We recommend communicating as clearly and as concisely as possible. Summarise any technical documents so that the key points are clear and understood. Try using the existing relationship with the customer to enhance your understanding of their needs.
At Fidelity
Our vulnerable customer champions meet on a monthly basis to evaluate any contact made by a vulnerable customer to understand what went well and what lessons can be learnt. These are then implemented across the business as necessary. Support is in place for colleagues dealing with the most sensitive cases.
Regular training is held to make sure knowledge stays up to date and a customer-centric culture permeates all areas of our business.
Adviser firm
We suggest reviewing your policy and procedures on a regular basis. Be able to identify learning processes and implementation of new ways of working as necessary, and record as appropriate.
The latest FCA Financial Lives survey estimates that 24.9 million UK adults have characteristics of vulnerability. Vulnerable customers are therefore likely to make up a large proportion of most firms’ client banks. Here we present some examples of how Fidelity, along with the client’s adviser, have helped customers in vulnerable situations.
Download case studiesAll you need to know about the online services available to clients, along with support materials you can use to encourage them to move online.
Here you’ll find all the information you need in relation to administering an account following the death of a client.
Access dedicated support materials and resources as you work towards implementing the Duty within your firm.
Overview