Financial services firms are turning to technology in order to surface data as they prepare for the FCA’s new Consumer Duty, according to new research from Moneyhub.

The open finance and payments platform stated that close to half (48%) of firms are planning to or have already investing in technology to develop and deliver more personalised and targeted communications.

Two in five firms (41%) have plans to invest in technology in order to access customer data and insights, the research also found.

For Moneyhub’s new report, titled FCA Consumer Duty: Business Burden or Golden Opportunity?, 150 senior decision makers from FCA regulated firms were interviewed on their preparedness ahead of the first Consumer Duty deadline at the end of October.

The FCA’s new regulations are to ensure that customers receive communications from financial services firms that they understand, and are being offered products that meet the individual’s need at the point of sale and throughout the entire product lifecycle, offering fair value and providing support when needed.

According to the research, there is a significant knowledge gap across many firms with 38% of senior decision makers indicating they had either limited or no knowledge of the upcoming Consumer Duty legislation, with some only alerted to the legislation by the Moneyhub research.

However, there were also signs that firms were getting their plans in place, with 22% of firms having projects in place in order to meet the deadline in 2023, and a further 28% currently developing plans to become compliant – with technology held the key to Consumer Duty preparedness.

Moneyhub CEO, Samantha Seaton, commented: “There are no excuses left, businesses must ensure they understand their customer completely in order to offer products and services that fit their circumstances throughout the entire duration of their relationship.

“And the only way this is possible is with an ongoing holistic view of their customer’s financial universe. Open Finance truly holds the key for firms to meet Consumer Duty. But to see open finance’s role as solely a solution to a problem is a mistake. It is also an opportunity.

“By better understanding your customer, it means you can offer super relevant, appropriate products and services, and ultimately create stronger relationships and build loyalty. Smart, forward looking businesses will seize this moment and reap the benefits of truly understanding their customer.”

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