Regulations

Story: FCA Flags Product Design Gaps Even as Firms Post Real Consumer Wins

By Pankaj K

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Where Firms Are Actually Getting It Right. Some of the examples the FCA pulled out are worth slowing down on.

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The Consistency Problem the FCA Can't Ignore. But here's the issue. Those examples are highlights, not the norm.

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What the FCA Wants Firms to Do Next. The regulator isn't calling for a revolution. The message is more practical than that.

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The Financial Conduct Authority has a mixed verdict on financial product design. Progress is real. But it's patchy, and the regulator isn't pretending otherwise.

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The FCA's review, carried out under the Consumer Duty framework, looked at three core areas: how firms design products from the start, how they monitor those products over time,…

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Some of the examples the FCA pulled out are worth slowing down on. One firm offering appliance insurance started providing temporary mini fridges to customers who needed cold…

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A bank cut ATM withdrawal complaints by 45% — that's a real number — by making app information clearer and giving staff better training. It didn't require a product overhaul.

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And a third firm tackled financial abuse head-on by introducing a special debit card for caregivers.

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These aren't small wins. They're the kind of outcomes Consumer Duty was supposed to produce.

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More context: FCA Bags 11-Year Prison Sentences and Hits 650 Social Media Takedowns in Year One

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But here's the issue. Those examples are highlights, not the norm. The FCA's own assessment is pretty clear that consistency is still lacking across the industry.

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One recurring problem is target market definition. The FCA found that while some firms do a strong job identifying specific consumer groups and designing products to match,…

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Monitoring is another weak spot. Lots of firms are collecting data — customer feedback, behavioral signals, complaints data, the usual mix. That part has improved.

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Third-party distribution is probably the murkiest area. The FCA saw improvements — clearer expectations being set for distributors, better information sharing. Good.

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The regulator isn't calling for a revolution. The message is more practical than that. Firms should look at the stronger examples in the industry — including the ones the FCA has…

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