Two-thirds of senior figures at banks and building societies say they are not ready for the new Consumer Duty rules, although 87% of them agree that the sweeping new regulations “will have a significant impact” on how they do business.   

Another 22% of chief executives, chairs and directors at these institutions do not think they will be prepared for the guidance by next April, the original deadline for the new sweeping customer service rules set by the Financial Conduct Authority, according to new research from Moneyhub.  

However, in July, the city watchdog said it would give firms 12 months from the end of next July to implement the new rules, rather than having to be fully compliant from next April, after some firms argued they would have to drop complex products, restricting consumer choice, to make the original deadline.  

But the report by the payments platform found that 11% of senior decision-makers said they did not know anything about the new rules, while 4% only learnt of the upcoming changes during an interview with the compilers of the study.  

The FCA says its Consumer Duty guidance will “fundamentally improve how firms serve consumers” by setting out “higher and clearer standards of consumer protection across financial services”.   

It wants the rules to end “rip-off charges” and make it easier for customers to switch products. It also wants firms to more clearly explain their products “rather than burying key information in lengthy terms and conditions”, and offer more support to vulnerable customers, such as pensioners or those under financial stress.  

Moneyhub’s study asked decision-makers what is the most challenging part of the guidance, and 33% say making sure that communications equip consumers to make effective decisions about their finances.   

Another 27% say offering specialised products and services that meet the needs of customers, while the same proportion says offering the right customer support “would be the most challenging” aspect of the new rules.  

The poll adds that 53% of decision-makers say they will invest in technology to develop “more personalised and targeted communications” for customers.  

Moneyhub chief executive Samantha Seaton says: “Consumer Duty is so much more than a box-ticking exercise. Inflation, ease of accessing credit, rocketing cost of borrowing, and our move towards a cashless society all have a massive impact on the financial resilience of people.   

“Finances for most are incredibly confusing and stressful. Most of us no longer physically interact with money, which is also adding to the confusion and stress about managing money.   

“With Consumer Duty the responsibility shifts from the consumer to us, the financial services industry, and in particular the product providers.   

“When it comes to consumers’ finances, we as an industry are in a position of strength because we do know how money works, however, we will only get this right if we have an aggregate view of the customer.”  

Moneyhub commissioned data group Opinium Research to interview 150 senior decision-makers at FCA-regulated firms over the phone in July and August.