6 outcomes simplified

As with any regulator, the rules and definitions are never quite as obvious as they should be. In this topic we re visit the 6 outcomes and simplify them, we like things that are easier to understand

Below, We’ve outlined them and given you some expectations which should help you have confidence in your fair – or unfair – treatment of customers, now or in the future.

What are the six TCF consumer Outcomes in easy to understand terms? 

1. The FCA says: “Consumers can be confident that they are dealing with firms where the fair treatment of customers is central to the corporate culture.”

What that actually means: It’s bit of a no brainer at first glance, but this is actually quite important.

What the FCA are saying is, they don’t want companies to do the right thing because they have been told they have to. They want companies to do the right thing because it’s in their corporate blood to do so. It’s all about integrity and honesty right from the outset, and making sure that everyone knows where they stand.

2. The FCA says: “Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly”.

What that actually means: Think about the fallout from PPI and you’re in the right area with this one.

The FCA are saying that it’s unfair to sell a product to a customer who has no need of it, or if it’s too expensive for their budget.

An example of this would be selling a 35 year mortgage term to a customer who’s five years away from retirement, or selling payday loans to a person who doesn’t have a job.

Affordability plays a very big part here. Lenders must ensure that if you wish to borrow any amount of money that you can actually afford the repayments.

3. The FCA says: “Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.”

What that actually means: Most of us know about the small print and the ‘devil being in the detail’. This principle means that companies can’t hide important information in the small print any more.

When a company tries selling a financial product or service, The customer must be made aware of its key points.

These include:

• the total cost of borrowing
• any penalty charges
• the term of the agreement,
• whether or not their home is being used as security

In fact, anything which is going to cost the customer more money now or down the line must be brought to their attention, before they sign on the dotted line. 

4. The FCA says: “Where customers receive advice, the advice is suitable and takes account of their circumstances.”

What that actually means: In the past, companies have found themselves in a spot of bother over the advice given to their customers.

This doesn’t just concern things such as loans; it can also relate to insurance and pension funds. It goes without saying that when giving advice on such important issues such as a customers pension, that they must get the best possible advice relevant to their specific circumstances.

This simple principle from the FCA covers a whole world of hurt if it’s not adhered to by companies.

5. The FCA says: “Consumers are provided with products that perform as firms have led them to expect, and the associated service is both of an acceptable standard and as they have been led to expect.” 

What that actually means: Just like anything else purchased on the high street, financial products and services must ‘do what it says on the tin’.

If you bought a car without an engine you would be quick to complain. With this in mind, it’s only fair that if you’re told that your savings account will deliver a certain amount of interest in a given period, it does just that.

This principle covers all types of financial products, from pensions and loans to insurance and bank accounts.

6. The FCA says: “Consumers do not face unreasonable post-sale barriers imposed by  firms to change product, switch provider, submit a claim or make a complaint.”

What that actually means: In short, if a customer wants to switch providers, make a claim, or even complain, it must be simple to do so.

A slow response to these things from financial companies isn’t fair to the customer. The FCA doesn’t tolerate it. In fact, any time a customer interacts with a company they must respond and or deliver in a reasonable time frame.

‘Put it in writing’ is no longer an acceptable response when a customer wishes to complain or make their concerns known. For example, 3 months to switch bank accounts is not a reasonable amount of time, 7 days is. Insurance claims must be dealt with in a timely manner to meet the needs of the claimant. 

So now that’s all cleared up…

I hope that now we’ve boiled these points down to their bare, plain English essentials, you’re feeling at least a bit more confident with how TCF can actually make life easier for customers and for the organisation you work for