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Consumer Duty – How can contact centres help to comply?


The Team at CallMiner

April 25, 2024

NLP Machine Learning Customer experience
NLP Machine Learning Customer experience

Originally published The Forum's 2024 Best Practice Guide: Shaping the Future

By Nick Rowe, Business Analyst, CallMiner

Consumer Duty requirements were launched by the UK’s Financial Conduct Authority (FCA) in June 2023 and for the financial services sector represent legally binding regulation. But what does this actually mean?

The requirements are non-negotiable; if you’re operating in the financial services market, you have to be compliant and show evidence of the fact.

Further, in a world increasingly focused on customer experience (CX), even if your organisation is outside of the financial services sector, following the Consumer Duty principles will ensure you have a finger on the pulse of what your customers think about your organisation’s products and services. And this can help you deliver better service to customers.

This article specifically focuses on how the contact centre (and conversation intelligence) can assist your organisation in complying with Consumer Duty. From the board all the way through to marketing, sales, service, and more, every aspect of your company should be considering Consumer Duty.

So, what is Consumer Duty?

Fundamentally, there are four pillars to Consumer Duty:

  • Products and Services
  • Price and Value
  • Consumer Understanding
  • Consumer Support

The regulations expect organisations to ensure that they are selling appropriate products and services to the right consumers; that the consumer will be paying a fair price and get value from their purchase; that the consumer is given clear and understandable information; and that if the consumer has a problem, they will be able to access assistance easily.

Not rocket science nor brain-melting concepts, many companies consider all of these things standard best practices. The difference is that the FCA has mandated companies need to do all they can to prevent harm to the consumer. It’s no longer ‘best practice’, it’s the law.

How can contact centres help to comply?

Firstly, contact centres can monitor sales conversations to ensure that the products and prices are appropriate for the customer, and they understand what they are committing to. Most conversation intelligence solutions can be configured to identify pass/fail scenarios for these sales interactions, and this will be your first line of defence against mis-selling or not putting the consumer’s interests first. For example, if the customer states they are claiming their pension, they are probably not the right person to be entering into a 30-year mortgage agreement.

Speech analysts can work with subject matter experts to identify key risk areas that need to be monitored within these conversations and the resulting insights can be used to show the FCA that proactive measures are in place to comply with Consumer Duty.

Secondly, it’s important to listen to what customers are saying when they get in contact. The contact centre is the ears of the organisation, the main touchpoint your customers have with the business, and they will be telling agents about the issues they are experiencing. Let’s take a look at some of the language you may encounter and where that sits within Consumer Duty.

Phrases: "I thought I was covered for this"; "Nobody told me that"; "This is no good for me"; "I can't use it the way I want"

Consumer Duty pillar: Product and services expectations

Phrases: "This is a waste of money and time"; "Not worth the paper it's written on"; "I can't afford to be paying for this"; "This is a rip off"

Consumer Duty pillar: Price and value

Phrases: "I don't understand why"; "I'm totally confused"; "I don't know what this is all about"; "I'm not sure what this is for"

Consumer Duty pillar: Consumer understanding

Phrases: "This is the third time I've tried to resolve this"; "I've been on hold for hours"; "No one cares about helping me"; "Someone was supposed to call me back"

Consumer Duty pillar: Consumer support

There will also be other clues in the interactions, such as excessive duration, significant holds, long silences or multiple transfer events.

Single examples of these events and phrases may not necessarily equate to a breach of Consumer Duty, but you can stack all of these together as risk factors – the more you see, the more likely you are to have a consumer that is feeling the organisation has not been looking after their best interests. In addition, you can look for explicit complaints or expressions of dissatisfaction, as well as mentions of potential vulnerabilities.

By finding interactions that hit these key risky events and behaviours (with additional complaint/vulnerability markers, if required) you will be able to do two things.

  1. Pass the details to a mitigation team to contact the customer and resolve their issue
  2. Provide evidence to the FCA that your organisation can find these interactions and act on them to ensure the consumer’s best interests are addressed

A potential third outcome may be the root cause analysis of these risky interactions shows particular processes that are going wrong further upstream. Rectifying those would prevent other customers experiencing the same issues.

From proactive monitoring to risk scoring of all customer service interactions, organisations can reduce their exposure to fines from the FCA. But it’s important to remember that these principles can be applied to any organisation dealing with customers who are questioning whether they have been sold an appropriate product or service, and how well that organisation can assist in rectification.

Of course, an organisation shouldn’t just look at telephone conversations. These risk factors are also likely to occur in text-based interactions, such as webchats and emails, so being able to analyse all customer interactions for Consumer Duty risks is critical to staying compliant with the legislation.

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