The complaint-handling journey itself of a company may also therefore need to be changed, to ensure that teams approach complaints in line with the duty and understand the needs, characteristics and vulnerabilities of customers throughout the complaints process.

It is crucial that this information is documented, as the FOS may request to see records evidencing how a company has satisfied itself that a customer’s individual needs have been met and how quickly teams are taking to respond to complaints.

MI will assist here, flagging where customers are not receiving good outcomes and where complaints have been and are mostly likely to be made.

An efficient and effective complaints-handling process could help to act as a deterrent to customers issuing claims, particularly for poor customer service. 

The FCA has confirmed that it will exercise its powers to require Section 166 reviews of companies, with a particular focus on serious harm and firms that are not operating in the spirit of the duty. 

In the final weeks running up to implementation, companies should not only make the required changes to comply with the duty as identified through MI, planning and testing, but continue to review and reflect on customer journeys to ensure compliance with the duty.

By doing this, gaps can be closed where possible before the July deadline, or be flagged to the FCA where companies do not consider it likely that gaps will be rectified in time.

This will assist in avoiding serious breaches of the duty, reduce the risk of harm to retail customers, and potential damage to a company’s reputation if there is non-compliance.

Claire Carroll is a partner in the litigation and dispute management team and Sian Jones is an associate in the financial services, disputes and investigations team at Eversheds Sutherland