Since our last publication, the FCA has published its findings of a thematic review in relation to how firms assess their customers' understanding of the products they buy. In other news, the FCA has updated its policy development update webpage, which sets out information on recent and future FCA publications.
FCA thematic review report on customers' understanding of products bought
The FCA recently published its findings of a thematic review in relation to how firms assess their customers' understanding of the products they buy. Their approach to the thematic review involved requesting information from a sample of 18 retail banks and building societies and visiting a sample of these firms to better understand their systems and practices. The firms were asked to provide examples relating to mortgage, credit card and cash savings account transactions. They were also able to provide examples from any other relevant product areas. The FCA's review identified that many firms have embedded, or are developing, systems and practices to assess customer understanding of particular products throughout the lifecycle of a product, that is, at the pre-sale, point of sale and post-sale stages. This includes advised and non-advised sales. Some firms continue to confuse customer understanding with customer satisfaction. It also identified that firm practices appeared least developed in the area of online sales, although some were taking steps to address this.
FCA, 17 July 2017
FCA policy update: July 2017
The FCA has updated its policy development update webpage, which sets out information on recent and future FCA publications. For InCredit readers, the updates most likely to be of interest are: (a) a policy statement to CP16/42 and further consultation on reviewing the funding of the Financial Services Compensation Scheme, due for publication in the fourth quarter of 2017; (b) a policy statement to CP17/7 on the UK implementation of the Directive on Insurance Distribution, due for publication in September 2017; (c) a second consultation paper on IDD implementation, due for publication in July 2017; (d) a consultation paper on new rules for firms running crowdfunding platforms, due for publication on a date to be confirmed; (e) a consultation paper on information about current account services, due for publication in July 2017; (f) a consultation paper on creditworthiness and affordability in consumer credit, due for publication on a date to be confirmed; and (g) feedback to chapter 7 of CP17/6 (Smarter Consumer Communications: changes to COBS and MCOB) due for publication on a date to be confirmed.
FCA, 14 July 2017
LSB business plan for 2017/20
In the business plan, the LSB provides details on how it plans to achieve its "2020 Vision". It notes that the three-year time horizon covered by the plan is challenging. However, the LSB believes that it has a unique role in setting high standards that complement the FCA's work, covering areas that the statutory protections do not reach. It explains that the business plan is more than a mere continuation of the last three-year plan, as the LSB seeks to make a stepped change in its development.
LSB, 13 July 2017
FCA consults on draft authorisation and reporting forms as part of PSD2 implementation
The FCA has published a consultation paper on draft authorisation and reporting forms as part of its implementation of the revised Directive on payment services in the internal market ((EU) 2015/2366) (PSD2) (CP17/22).
FCA, 13 July 2017
PSR responds to CMA's approval to create new payment systems operator
The Payment Systems Regulator has welcomed the consolidation of Bacs, the Cheque and Credit Clearing Company and Faster Payments Scheme which has been given approval by the Competition and Markets Authority.
PSR, 12 July 2017
FCA statement on ESMA Q&As on transitional provisions under Benchmarks Regulation
The FCA has published a statement on the ESMA questions and answers (Q&As) relating to the implementation of the Regulation on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds (Regulation (EU) 2016/1011) (Benchmarks Regulation or BMR)).
FCA, 10 July 2017
PRA speech on why supervision matters
The Bank of England (BoE) has published a speech given by Sam Woods, BoE Deputy Governor, Prudential Regulation, and PRA Chief Executive Officer, on the importance of supervision.
PRA, 10 July 2017
EBA issues final guidelines on authorisation and registration under PSD2
The EBA has published a final report which contains final guidelines on the information to be provided by applicants intending to obtain authorisation as a payment institution (PI) or e-money institution (EMI), or to register as an account information service provider (AISP), under the Directive on payment services in the internal market ((EU) 2015/2366) (PSD2).
EBA, 11 July 2017
ESMA invites European Commission to widen scope of proposal to strengthen EU third-country equivalence regime for market infrastructures and key market players in light of Brexit
ESMA has published a letter from Steve Maijoor, ESMA Chair, to Valdis Dombrovskis, European Commission Vice President, on third country regimes within ESMA's remit.
ESMA, 10 July 2017
Partner, Financial Regulation and Co-head of Financial Services Sector