On 13 March 2026, the Financial Conduct Authority (FCA) published the findings of its review into firms’ approaches to consumer understanding under the Consumer Duty (the Duty).

Background

The FCA explains that consumer understanding is an outcome under the Duty and that its requirements and expectations in relation to this are in PRIN 2A.5 and Chapter 8 of its Finalised Guidance (FG22/5).

The FCA further explains that these examples of good and poor practice are provided to help firms learn from each other and support improvements in consumer understanding across the market but that they are not intended to create new regulatory requirements but that firms should use these insights to assess their own approach and identify where improvements may be needed to meet their obligations under the Duty.
 

Key findings

The FCA set out the following key findings:

  • Using insight to identify where customers struggle: good practice included firms analysing insights from multiple sources, including call listening, complaints, chat transcripts, website analytics, drop-off data (customers who start but do not complete a specific process) and surveys and then reviewing this evidence regularly and prioritising meaningful improvements rather than simply making cosmetic changes.
  • Testing communications with real customers: good practice included testing both before and after changes to communications and that firms use proportionate tools such as surveys, comprehension checks, A/B testing (before and after) and feedback from frontline interactions as part of this and then verify whether changes improve customer understanding and adapt based on the results.
  • Communicating clearly, simply and accessibly: an effective approach included using plain language, clear structure, visual hierarchy and layered content and firms should place essential information upfront, highlight risks and exclusions early, and support those who need alternative or accessible formats.
  • Designing journeys and tools that support understanding: that well-designed customer journeys incorporated calculators, videos, walkthroughs and summaries and that these tools should be tested to make sure they genuinely help customers and refined based on user evidence.
  • Supporting customer with characteristics of vulnerability: an effective approach is to identify needs early, adapt communications accordingly and embed vulnerability considerations into governance, training and testing, which includes testing with vulnerable cohorts and ensuring accessibility throughout journeys.
  • Clear, fair and balanced financial promotions: a good approach aligned with the Duty makes sure promotional content is balanced, accessible and easy to understand and that firms should give risks equal prominence to benefits, avoid jargon and test that key messages are properly understood.
  • Governance and oversight: good practice included clear ownership of the consumer understanding outcome and that firms maintain defined governance, review management information regularly, track actions, and make sure decisions lead to improvements.