Empowering staff is vital for looking after vulnerable customers
16 June 2021
Empowering and enabling staff to recognise and respond to vulnerable customers is vital if firms are to meet regulatory expectations on the fair treatment of vulnerable customers.
Our research suggests firms have made a good start in this area, with frequent training for customer-facing staff and progress being made to balance flexibility with consistency. And our conversations with firms reveal the majority are confident they have empowered their staff. But we have also seen examples of poor practice. So how can firms take the crucial next steps from the positive inroads they’ve already made, to the next level of maturity?
Training is vital. We have seen some firms not providing tailored training to teams or individuals other than those who are customer-facing. This means product design teams, and even senior managers, are not developing an understanding of the FCA’s expectations on vulnerable customers. This often prevents such individuals from understanding the impact their role can have on vulnerable consumers, and may prevent effective challenge from senior management. We recognise providing tailored training for individuals across a business is challenging if not developed in-house, but this is an important step on the way to a more mature approach.
One way we have seen firms overcoming this challenge is by utilising a ‘core’ vulnerable customers training module with specific add-ons for different teams. For example, an add-on focused on management information for senior managers, or on prevalent characteristics of vulnerability for design teams.
A second area where maturity could be improved is in the way firms achieve the right balance between flexibility and consistency. This is a complex area to unpick in a few words - but while overly rigid processes may result in a customer’s needs not being met, too much flexibility may lead to inconsistencies and greater complexity. A number of poor practices have been witnessed by the regulator in this space which include: an over-reliance on exemptions (to the point that exemptions become the norm), rigid product eligibility criteria preventing customers from accessing the products they need, and a poor governance structure, resulting in different outcomes for customers in similar situations.
The most mature approaches we have seen here largely revolve around a very clear understanding by staff of what options are available at any given customer touchpoint. This enables staff to feel confident in their handling of issues and promotes consistency. To reinforce this understanding, firms with mature approaches are utilising data to gain clarity on what adaptations or options are being used, how frequently, and for how long. These insights in turn enable firms to improve product and service design and training, and build a better understanding of customer needs.
So while firms have made good progress, further steps to improve training and establish a balance between flexibility and consistency will facilitate better experiences for vulnerable customers - an outcome we all wish to see.