FCA says vulnerable customers at risk from inflexible policies
Vulnerable customers seeking help from financial providers are met with a "computer says no" approach that exacerbates their problems, new research has found.
A report from the Financial Conduct Authority (FCA) found that many consumer protection policies are designed for a "typical" consumer and are not flexible enough to cater for those individuals with specific needs.
This inflexibility and overzealous approach to the rules, particularly when it comes to data protection, is leading to people – who may already be experiencing financial difficulties – having their situation made worse by such rigid and unhelpful polices.
The report highlights one case where a cancer patient who contacted their bank to discuss their temporary loss of income was told to call back when their accounts was in arrears, while one carer with Power of Attorney told the FCA that one cashier had refused to serve her and another had refused to accept her blind mother's signature.
Helping the vulnerable
Launching the report, Martin Wheatley, chief executive of the FCA, said it was the first step in working with financial firms to address the problems faced by vulnerable customers across the UK.
"We all know somebody in a vulnerable situation and we can expect the number of people who find themselves in those circumstances to grow over the coming years," he said.
"We all need to start thinking about what the solutions to these challenges will be. Whether it is accessing funds or securing a repayment holiday, we will work collaboratively with firms to identify what inclusive policies could look like and how best we can create the right outcomes for those consumers. It's a challenge for regulators and firms alike."
Joanna Elson, chief executive of the Money Advice Trust, the charity that runs National Debtline, added: "This report is very welcome and we hope it will encourage organisations to be more proactive in supporting customers who are vulnerable. There is a real opportunity here for the financial services industry to take a lead in this crucial area, and set an example for other sectors to follow.
"We look forward to working with the regulator, trade bodies and others in the financial services industry to ensure that vulnerable customers receive the support they need."
“Arrears” tend to be associated with debt. If you fall behind and miss payments on any outstanding debt, the amount you failed to pay is an arrear – the amount accrued from the date on which the first missed payment was due.