• Robert Bell

Recent Financial Services Updates

There have been quite a few recent financial services updates from the FCA and Financial Ombudsman Service that firms need to be aware of. We have summarised these here for easy reference.


Change of legal status – new FCA process

Until 1 June 2021, firms wishing to change their legal status could submit an application to the FCA – this has now changed, and firms will now need to submit a new authorisation application. The previous process was often less than straightforward, with incomplete applications causing delays. In some cases, a SUP 15.3.8G notification is all that is required – the table at the bottom of the page sets out when this is the case.


Recent Financial Services Updates

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Firms will also now need to sign a Deed Poll declaration that requires the firm to deal with complaints from existing customers in the same way that it would deal with complaints of the new firm. This requirement is aimed at preventing firms leaving behind their customer obligations by changing their legal entity.


Financial Ombudsman Service – Annual Complaints Data

The FOS has reported that over April 2020 to March 2021 period, they received almost half a million new enquiries and 278,033 new complaints of which 89% were resolved. Just over 60% of new complaints were about banking and credit, 16% were about insurance, 7.5% were about investment and pensions, and 15% were about PPI. Excluding PPI, the uphold rate was 40%.


The FOS’ analysis of complaints cases acknowledges that the effect of the pandemic is reflected within the complaints, not least in the significant increase in non-PPI complaints – a 58% increase on the previous year.


In setting out some of the key issues, the FOS highlight that the past year has underscored that the ‘fundamentals of customer service matter more than ever’:


  • Many complaints could have been avoided with better communication, particularly in managing customers’ expectations during a difficult period when the pandemic’s impact on businesses has been unavoidable

  • A failure to properly investigate and address individual circumstances was behind many upheld cases – often where the business has not addressed what went wrong or suggested a way forward that was appropriate for that customer. The FOS have highlighted that given the FCA’s research findings that increasing numbers of people in the UK have characteristics of vulnerability, the taking into account individual circumstances should be a key consideration for firms over the next 12 months

  • The impact of the pandemic is likely to continue over the near future, with the impact on consumers’ lives, their finances and what they need from financial services likely to develop.


The most complained-about issue was unaffordable lending. The highest uphold rate was 83%, for complaints about home credit. The Ombudsman re-iterated here that taking into account an individual customer’s circumstances could have resolved most of the issues that they see – and they suggest that the simple act of failing to speak to a customer over the phone where appropriate or asking for information direct from a customer has been behind many of the upheld complaints. Similarly, the FOS suggests that staying alert to signs that a customer might be struggling could help to resolve complaints and issues where customers feel they have been lent money they could never have afforded to repay – an issue for which the FOS decided in consumers’ favour in a majority of cases.


FCA consumer credit information sheets

The FCA has updated the webpage on consumer credit information sheets that lenders must include when notifying consumers that they are in arrears or default, as required by the Consumer Credit Act 1974.


The updated information sheets will come into force on 25 October 2021. They have been changed to provide more ‘targeted and useful help to customers, particularly those with mental wellbeing issues’.


Firms must use the current version (26 July 2018 – 24 October 2021) until 24 October 2021.


The information sheets cover:

  • Arrears

  • Default

  • High-cost short-term loans

  • High-cost short-term loans peer-to-peer lenders

  • Arrears peer-to-peer lenders

More information is available on the FCA’s webpage.


FCA Regulation Round Up – SM&CR

The full roll-out of the Senior Managers and Certification Regime was noted in the Regulation Roundup for May, with a reminder that the FCA hopes the regime will lead to a ‘step change in culture and conduct’.


The FCA writes that the roll-out is not the end of the matter and that firms need to think about the FCA’s expectations, and about SM&CR in the context of their wider culture. Senior Managers will be expected to make tangible steps towards fostering healthy cultures. The Certification Regime is designed to mean that there will be standards for the competence and conduct of key staff, and the Conduct Rules set a new standard in behaviour for all employees.


Staff that fall under the Certification Regime should, by now, have been assessed and certified and all staff to whom the Conduct Rules apply should have been trained on how the rules apply to them.


We offer two online Conduct Rules Training courses, which allow Senior Managers and Certification and all other staff to access and complete the training at their own convenience, ideal for those who want to complete the training in their own time, and to come back to it to refresh later on. They provide clear and comprehensive training in the Rules, including a mix of videos, small amounts of text and plenty of scenarios to demonstrate how the rules apply practically.


For large groups, we can offer a simplified enrolment service and pricing, simply email Robert.bell@rbcompliance.co.uk.




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