The FCA delays consultations to continue navigating the pandemic

The FCA has offered an update on work that it intends to halt due to the ongoing pandemic and subsequent economic conditions. 

The body outlined that the changes will allow it to focus resources on the most urgent work where it can make the most immediate difference to consumers and markets.

During the pandemic, the group has underlined its commitment to ensuring that consumers are protected and firms treat their customers fairly. 

The group stated: “We have introduced a number of measures to ensure firms are clear on their responsibilities, particularly where their customers are vulnerable. 

This has included support for consumers on mortgage payments, personal loans, credit cards, overdrafts, motor finance and other forms of credit, as well as draft guidance for firms on the fair treatment of vulnerable customers.

“Ensuring markets work well and that consumers are offered fair value products in a digital age is also a priority for us. This includes tackling the loyalty penalty in markets where we see the most harm.” 

As part of this, the group is consulting on a package of remedies to stop firms systematically increasing prices in home and motor insurance for loyal customers in the future. 

Furthermore, in its Feedback Statement on Duty of Care and potential alternative approaches, it is committed to reviewing how it applies the regulatory framework, particularly the Principles for Businesses. It will also focus on how new or revised Principles could strengthen and clarify firms’ duties to consumers. 

In April, it announced that this work was delayed due to the need to prioritise its response to coronavirus and that it had intended to consult on potential options for change by the end of the year. Given current conditions, the group is now aiming to consult in Q1 2021.

As well as this, in January 2020, it published a consultation paper (CP20/1) setting out proposals to simplify and improve competition in the cash savings market by introducing a Single Easy Access Rate (SEAR).

The consultation was due to close in April 2020. Due to the impact of coronavirus, it extended the consultation period to 15 December 2020, to prioritise urgent work with banks and building societies to help consumers during the pandemic.

Given the continuing impact of coronavirus and the low-interest rate environment, it revealed it has decided to stop this work.