Consumer Duty Readiness Framework

Assess your Consumer Duty compliance posture across the four outcomes — products and services, price and value, consumer understanding, and consumer support — with an evidence gap tracker.

How to Use This Framework

The FCA's Consumer Duty (PRIN 2A) requires firms to deliver good outcomes for retail customers across four outcome areas: products and services, price and value, consumer understanding, and consumer support. The Duty applies to all firms in the distribution chain for retail products and services, and the FCA has made clear that it will supervise firms' delivery of these outcomes through data, MI requests, and thematic reviews.

This framework evaluates your finance and operations function against all four Consumer Duty outcome areas, plus the governance and oversight framework that ties them together. Score each question: 2 = fully in place, 1 = partially in place, 0 = not in place.

Scope note: Consumer Duty applies to firms that distribute or manufacture retail products and services. If your firm distributes products manufactured by another firm, you should assess your obligations under the distribution chain requirements in addition to this framework. The Duty came into force on 31 July 2023 for open products and 31 July 2024 for closed products.

Assessment

Area 1: Products & Services Outcome

Q1. Has a fair value assessment been completed for every retail product or service, with a documented methodology and sign-off by the board?

2 — Fully in place: fair value assessment completed for all products using a documented framework; board sign-off obtained; assessment reviewed at least annually and on material product change 1 — Partially in place: fair value assessment completed but the methodology is not documented or board sign-off was not formally obtained; assessment not yet reviewed since initial completion 0 — Not in place: no fair value assessment; the firm cannot demonstrate that products provide fair value to retail customers

Q2. Has a target market been defined for each retail product, consistent with the product design and distribution strategy?

2 — Fully in place: target market defined for each product including positive and negative target market; distribution strategy aligned with target market; documented and reviewed annually 1 — Partially in place: target market defined at a high level but the negative target market is not specified; distribution strategy alignment has not been formally assessed 0 — Not in place: no formal target market definition; products are distributed without consideration of whether they are appropriate for the customers who receive them

Q3. Has the distribution strategy been reviewed to ensure it reaches the intended target market and avoids distribution to customers outside the target market?

2 — Fully in place: distribution channels reviewed; channel-specific suitability assessed; sales data monitored to identify any distribution outside the target market; remediation process in place 1 — Partially in place: distribution strategy was reviewed at implementation but has not been monitored since; no process to identify or remediate distribution outside the target market 0 — Not in place: no review of distribution strategy against Consumer Duty requirements; the firm cannot demonstrate that products are reaching appropriate customers

Q4. Is a product governance framework in place, with a defined product approval process that incorporates Consumer Duty considerations?

2 — Fully in place: product governance policy documented; Consumer Duty sign-off required before any new product launch or material product change; responsibility assigned to a named senior manager 1 — Partially in place: product governance process exists but Consumer Duty considerations are not formally embedded; sign-off is informal rather than through a documented process 0 — Not in place: no product governance framework; products are launched and changed without a formal review process that incorporates Consumer Duty

Area 2: Price & Value Outcome

Q5. Is pricing justified against the value delivered, with documentation showing that fees and charges are proportionate to the benefit received by retail customers?

2 — Fully in place: pricing rationale documented for each product; value delivered quantified where possible; pricing justified in the fair value assessment; board reviewed and approved 1 — Partially in place: pricing is set commercially but the justification against value delivered has not been formally documented; fair value assessment exists but lacks pricing-specific analysis 0 — Not in place: pricing has not been assessed against value delivered; no documentation exists to demonstrate that pricing is fair to retail customers

Q6. Has the firm conducted a price comparison against peer products to assess whether pricing is competitive and fair relative to the market?

2 — Fully in place: peer pricing comparison conducted and documented; methodology defined; comparison updated at least annually; results used to inform the fair value assessment 1 — Partially in place: informal awareness of peer pricing but no formal documented comparison; unable to demonstrate the analysis was performed systematically 0 — Not in place: no peer pricing comparison; the firm cannot demonstrate that its pricing is positioned fairly relative to the market

Q7. Have pricing and fees been reviewed specifically for vulnerable customers to ensure they are not disproportionately disadvantaged?

2 — Fully in place: vulnerable customer pricing review completed; any differential pricing justified; hardship provisions or fee waivers documented; outcomes monitored for vulnerable cohorts 1 — Partially in place: vulnerable customers considered in the fair value assessment but specific pricing impacts have not been assessed at a customer segment level 0 — Not in place: no consideration of pricing impact on vulnerable customers; the firm is unable to demonstrate that vulnerable customers receive fair value

Q8. Are all fees, charges, and costs disclosed to customers with full transparency, and is the total cost of the product presented clearly at the point of sale?

2 — Fully in place: all fees disclosed upfront in plain language; total cost of ownership presented clearly; no fees obscured in the terms and conditions; fee summary reviewed by compliance 1 — Partially in place: fees are disclosed but some charges are buried in the terms and conditions or are not presented prominently at the point of sale 0 — Not in place: fees are not disclosed clearly; customers cannot easily identify the total cost of the product before they commit

Area 3: Consumer Understanding Outcome

Q9. Have all customer-facing communications been reviewed for Consumer Duty compliance, with plain language requirements applied?

2 — Fully in place: all retail customer communications reviewed against Consumer Duty requirements; plain language guidelines applied; compliance sign-off documented; review cycle established 1 — Partially in place: key communications reviewed but a full review of all customer-facing materials has not been completed; some historical documents have not been updated 0 — Not in place: no systematic review of customer communications for Consumer Duty compliance; materials have not been assessed for clarity or potential consumer harm

Q10. Are financial promotions and marketing materials reviewed and approved by a competent person before publication, with a record of approvals maintained?

2 — Fully in place: all financial promotions approved by a qualified approver (CF21 or s21 approval); approval record maintained; promotions reviewed for Consumer Duty compliance before approval 1 — Partially in place: approval process exists but Consumer Duty compliance is not explicitly assessed in the approval checklist; some historical promotions may not have been formally approved 0 — Not in place: no formal financial promotion approval process; the firm does not have a qualified approver or does not maintain approval records

Q11. Are key information documents (KIDs, product summaries, terms and conditions) up to date and compliant with Consumer Duty disclosure requirements?

2 — Fully in place: all KIDs and product documentation updated for Consumer Duty; reviewed within the last 12 months; version control maintained; accessible to all retail customers 1 — Partially in place: documents reviewed but some older documents have not been updated; accessibility has not been formally tested for all customer channels 0 — Not in place: key information documents have not been reviewed for Consumer Duty compliance; documents may contain confusing or outdated information

Q12. Has customer testing or research been conducted to validate that retail customers understand the key features, risks, and costs of products?

2 — Fully in place: customer testing conducted for all key communications; results documented; material improvements made where testing identified comprehension failures; testing refreshed annually 1 — Partially in place: some customer research conducted but it was not specifically designed to test Consumer Duty compliance; comprehension of key terms and risks has not been validated 0 — Not in place: no customer testing or research conducted; the firm cannot demonstrate that retail customers understand its products

Area 4: Consumer Support Outcome

Q13. Are complaint handling metrics tracked and reported, with root cause analysis conducted and systemic issues escalated to the board?

2 — Fully in place: complaints tracked by category; root cause analysis conducted for all upheld complaints; systemic issues reported to board quarterly; FCA REP-CMAR filed on time 1 — Partially in place: complaints tracked and responded to but root cause analysis is not conducted systematically; board does not receive regular complaint MI 0 — Not in place: complaint handling is reactive and unstructured; no MI on complaints is produced; systemic issues are not identified or escalated

Q14. Is there a documented escalation process for complaints that ensures complex or high-value complaints receive appropriate senior attention?

2 — Fully in place: escalation thresholds defined (value, complexity, FOS risk, media sensitivity); escalation path documented; senior manager accountability assigned; FOS referral process clear 1 — Partially in place: escalation occurs in practice but the criteria are informal and undocumented; senior manager involvement depends on individual judgment rather than a defined process 0 — Not in place: no escalation process; all complaints handled at the same level regardless of complexity or severity; senior management has limited visibility of complaint outcomes

Q15. Is there a documented vulnerable customer policy, with staff trained on identification and adapted support for vulnerable customers?

2 — Fully in place: vulnerable customer policy aligned with FCA FG21/1; staff training completed and recorded; adapted support procedures documented; outcomes for vulnerable customers monitored 1 — Partially in place: vulnerable customer policy exists but training has not been completed for all relevant staff; adapted support procedures are not documented 0 — Not in place: no vulnerable customer policy; staff are not trained to identify or support vulnerable customers; the firm cannot demonstrate compliance with FCA guidance

Q16. Are response time SLAs defined for all customer support channels, monitored monthly, and met consistently?

2 — Fully in place: SLAs defined for all channels (email, phone, web chat, written complaints); monitored monthly; SLA performance reported to board; breaches investigated 1 — Partially in place: SLAs exist for some channels but not all; monitoring is informal; SLA performance is not regularly reported to board or senior management 0 — Not in place: no defined response time SLAs; customer support performance is not monitored; response times are inconsistent and not tracked

Area 5: Governance & Oversight

Q17. Has a Consumer Duty champion been appointed at board level, with documented responsibility for overseeing Consumer Duty compliance?

2 — Fully in place: Consumer Duty champion appointed and named in governance documentation; role remit documented; champion actively engages with Consumer Duty MI at board meetings 1 — Partially in place: a board member takes responsibility for Consumer Duty but the role has not been formally documented or disclosed in the governance framework 0 — Not in place: no board-level Consumer Duty champion; Consumer Duty oversight sits below board level; the firm cannot demonstrate senior accountability for the Duty

Q18. Has the board completed and approved an annual Consumer Duty report, assessing outcomes delivered and identifying areas for improvement?

2 — Fully in place: annual Consumer Duty board report completed before the anniversary of implementation; covers all four outcomes; identifies gaps and an action plan; board minute records approval 1 — Partially in place: board report has been prepared but does not cover all four outcomes in sufficient depth; action plan for gaps has not been formally approved by the board 0 — Not in place: no annual board report on Consumer Duty; the firm is in breach of the FCA requirement for an annual review of outcomes delivered

Q19. Is there an MI dashboard that tracks customer outcome metrics across all four Consumer Duty outcome areas, reviewed by the board at least quarterly?

2 — Fully in place: MI dashboard covers products and services, price and value, consumer understanding, and consumer support outcomes; reviewed by board quarterly; deteriorating metrics trigger escalation 1 — Partially in place: some outcome metrics tracked but the dashboard is not comprehensive across all four outcome areas; board receives ad hoc rather than regular MI 0 — Not in place: no Consumer Duty MI dashboard; the firm does not have a systematic way to monitor whether it is delivering good customer outcomes

Q20. Is there a documented action plan for Consumer Duty gaps identified in the annual board report or compliance monitoring programme?

2 — Fully in place: action plan with named owners, deadlines, and status tracking; plan reviewed at each board meeting; completed actions documented; plan updated as new gaps are identified 1 — Partially in place: gaps identified but the action plan is informal; no named owners or deadlines; progress is not regularly reviewed by the board 0 — Not in place: gaps identified but not formally tracked; no documented action plan; the firm cannot demonstrate it is taking steps to address known Consumer Duty deficiencies

Your Score

0 / 40

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Priority action: The FCA's Consumer Duty supervision focuses particularly on the governance and oversight area. A firm that scores well on products and services but has no board-level champion, no MI dashboard, and no annual board report is still at material supervisory risk. Address governance gaps alongside outcome-level gaps.

Consumer Duty Readiness Framework

How to Use This Framework

Assessment

Area 1: Products & Services Outcome

Area 2: Price & Value Outcome

Area 3: Consumer Understanding Outcome

Area 4: Consumer Support Outcome

Area 5: Governance & Oversight

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