NEWS28 March 2023

Savanta launches consumer duty research framework for financial services

Finance News People UK

UK – Market research agency Savanta has developed a communications testing framework for the Financial Conduct Authority’s consumer duty regulations, set to come into effect on 31st July 2023.

City of London at sunset

The new consumer protection rules set higher expectations for the standard of care that financial services firms give customers, and will require businesses to prove that their customers have a positive experience, avoid potential harm and receive information in an understandable way.

Savanta has worked with financial services clients to establish the new framework, using a mixed method approach, including quantitative testing and qualitative analysis. Clients will be able to use the model to assess whether customers comprehend their communications.

Stephen Palmer, executive vice-president, financial services, at Savanta, said: “We have created a tiered framework to test communications, allowing us to offer quantitative and qualitative solutions that deliver the core KPIs.”

The approach will also offer “diagnostics to measure true consumer understanding” and “clear direction” on the changes that clients can make, added Palmer.

Nick Baker, global chief research officer at Savanta, said: “With consumer duty creating a storm in the financial services world, we as researchers had our own duty to respond to the needs of our clients.”

A review published by the FCA in late January analysed how around 60 of the UK’s financial services groups were preparing for the new rules, warning that some would ‘struggle’ to apply the duty effectively by the deadline.  

In the report, the FCA urged firms to focus on ‘prioritising appropriately, focusing on reducing the risk of poor consumer outcomes’ and said businesses should ‘ensure that, when they are reviewing their products and services, communications and customer journeys, they identify and make the changes needed to meet the new standards’.