Amplifi & The Consumer Duty.

About the FCA’s Consumer Duty

The Consumer Duty has three main elements: 

1. A Consumer Principle

The broad “Consumer Principle” will provide an overarching standard of conduct that firms have to meet when producing or distributing products and services to retail clients. The Principle requires firms to act to deliver good outcomes for retail customers.

2. Cross-Cutting Rules

To assist firms in implementing the Consumer Principle the FCA is introducing a set of “Cross-Cutting Rules” which would apply across all areas of firm conduct. The cross-cutting rules require firms to:

• act in good faith

• avoid causing foreseeable harm

• enable and support retail customers to pursue their financial objectives 

3. The Four Outcomes

These “Outcomes” reflect key areas of the firm‐consumer relationship which are instrumental in helping to drive good outcomes for customers. These outcomes relate to: 

• products and services

• price and value

• consumer understanding

• consumer support 

Timeline

Firms must agree Implementation Plans at Board-level by end of October 2022.

By end of April 2023 they must have undertaken the necessary reviews of their products, communications and processes.

The rules must be implemented for all open products or services by end of July 2023 (i.e. all products that can be purchased or renewed). Rules must be implemented for closed book products no longer available to new customers by a year later, in July 2024.

The July 2023 timeline is considered challenging for many firms, but is an extension to the original April ’23 deadline.

Amplifi and Consumer Duty

Amplifi was used during the StepChange research to test the intelligibility of existing debt communications, and to guide and assess the simplification process.  This demonstrates the role that Amplifi can play for firms delivering the Duty.

The Duty requires that firms:

• Ensure their communications meet the information needs of customers and are likely to be understood and use plain and intelligible language.
  
  Amplifi’s unique analysis and simplification process directly supports the creation of simpler, more understandable information.

• To support consumer understanding, firms must tailor their communications, taking into account factors including the characteristics of the customer base, including vulnerability.
  
  Amplifi uses a range of metrics that can help to guide the degree of simplification a firm has achieved.

• Firms must test communications before communicating them to customers. Testing is required to be proportionate – while some testing will involve live testing with customers, the scope covers many thousands of documents and products for many firms. 
  
  Amplifi provides a means to test at scale, efficiently and quickly.