In episode 72 of the Growth Series podcast, Gurpreet Chahal, Corporate Account Manager at Accord Mortgages, speaks to Christine Newell, Mortgages Technical Director at Paradigm Mortgages, and Graeme Stewart, Head of Compliance Consultancy at Paradigm Consulting, about the Consumer Duty.
They begin the conversation by talking about what the Consumer Duty actually is and why the Financial Conduct Authority is concerned about the standard of customer support.
Gurpreet asks Christine and Graeme whether brokers and firms within the intermediary market services are aware of the Consumer Duty and ready for it to be introduced, and both believe they are starting to recognise the terminology being used.
However, Christine warns that many brokers and businesses will feel they don’t actually need to do anything at all, while Graeme thinks many haven’t yet picked up on the fact it demands a change in culture, rather than a set of rules.
Next, Gurpreet asks what firms need to start putting in place now, and both agree that they should focus on reviewing their company culture, so they’re well placed to help vulnerable clients in particular.
The pair are then asked for their view on the current culture and mindset within the intermediary market regarding clients and whether this needs to shift. Graeme believes firms have good intentions, but says they need to evidence positive outcomes in the management information they produce, so they can demonstrate to the FCA the positive results they garner from satisfied customers.
Christine agrees that companies have to invest more time in producing management information to evidence the implementation of the Consumer Duty, as well as in compliance, training and competence.
Finally, Gurpreet asks what benefits could the Consumer Duty lead to. Graeme believes it will lead to a much greater focus on communication at every stage of the advice process, with firms producing more visual material, case studies and using more straightforward language in literature for clarity and brevity.
Graeme also predicts that the Consumer Duty will lead to brokers and intermediary firms offering more holistic advice, providing guidance on financial issues other than mortgages, such as income protection and critical illness cover. Christine adds that mortgage providers may also begin outsourcing certain products or change their distribution strategy on some products if they don’t feel confident on advising on particular subjects, or appoint a specialist on these areas within the firm.
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01:03 to 33:14
Introduction to the guest
What is the Consumer Duty?
Are brokers ready for the Consumer Duty?
Preparing for the Consumer Duty
The FCA’s view on customer support
What role will lenders and distributors play with Consumer Duty?
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