The FCA is still finalising its rules in relation to the Consumer Duty, but many firms have already started preparing for its implementation. This approach is consistent with the FCA's messaging which is pushing firms to get a head-start now. However, due to the focus and drafting of the existing Consumer Duty materials, and in contrast to other types of financial institution, the practical application of the duty to the payments sector seems less clear.
All the more reason therefore for e-money institutions, payment institutions and account information service providers to start undertaking the tricky task of identifying the areas of their business in scope of the regime. They will then also need to consider how they implement and embed the rules, and ensure that they are able to demonstrate compliance on an ongoing basis.
So, what are some of the challenges payment firms are going to face and how might the new duty apply? Our note summarises some of the key points and picks out some of the challenges payments firms will likely face.
July 2022 update: For more insight on what the Consumer Duty means for the UK payments industry, listen to our payments podcast.