The Model Office Blog

Navigating the FCA Consumer Duty: Are Firms Delivering on Ongoing Services?

[fa icon="calendar"] Feb 19, 2024 4:02:53 PM / by Chris Davies

The FCA are hitting 2024 ground running with their latest data request to 20 select advise firms. The focus for on-going series means the FCA is adamant firms need to 'walk their talk' when it comes to segmentation, ensuring products and services continually meet client needs and objectives and annual suitability review meetings are conducted if paid for, if they have been paid for and not delivered then firms need to refund this cost!

Model Office has now incorporated this latest FCA directive within it's RegTech to ensure firms can  measure on-going client service data and employ evidence based practice which are key in ensuring fair value in ongoing services, and advice firms would do well to also ask themselves critical questions which Bovill's Principal Consultant Michael Lawrence focused on, to continually assess and improve their on-going service(s) offerings:

1. Are ongoing services necessary for all of our clients?
It's essential to evaluate whether all clients benefit from ongoing services or if certain clients may be better served through ad-hoc consultations or other arrangements. Tailoring the service model to the unique needs of each client segment ensures resources are allocated efficiently while maximising client satisfaction.

2. Are our clients in the right type of service to meet their ongoing needs and objectives?
Different clients may have varying levels of complexity, risk tolerance, and financial goals. Reviewing whether clients are enrolled in the appropriate service tier ensures that their ongoing needs and objectives are adequately addressed. This may involve revisiting client category profiles periodically to ensure alignment with the chosen service model.

3. Do we ensure ongoing services are consistently delivered and closely monitored?
 Consistency in service delivery is paramount to ensuring client satisfaction and maintaining regulatory compliance. Regular monitoring of service delivery processes helps identify any deviations from established standards and allows for timely intervention to address any issues that may arise.

4. Do our ongoing services provide fair pricing and deliver value to our clients?
Pricing transparency is key to building trust with clients. Advice firms should conduct regular reviews of their fee structures to ensure they remain competitive and aligned with the value provided. Assessing the perceived value of ongoing services from the client's perspective helps ensure that pricing reflects the benefits received.

5. How can we enhance or change our ongoing services to ensure they provide both value and fair pricing?
Continuous improvement is essential to adapt to evolving client needs and market dynamics. Soliciting feedback from clients and staff, benchmarking against industry standards, employing a service cost/benefit analysis and staying abreast of regulatory developments can help identify areas for enhancement. Implementing necessary changes ensures ongoing services remain relevant, valuable, and fairly priced.

By asking these critical questions and taking proactive steps to address any gaps or inefficiencies, advice firms can enhance the quality of their ongoing services, strengthen client relationships, and demonstrate a commitment to delivering fair value in line with the FCA Consumer Duty.

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Topics: Financial regulation, Financial business development, fintech, client engagement, regtech, Risk management, practice management, FCA, compliance, consumer duty

Chris Davies

Written by Chris Davies

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