Most vulnerable customers do not feel comfortable about talking to their financial service providers about their situation, according to the Financial Conduct Authority (FCA) in its Vulnerability Review, published today.
The FCA said a total of four in 10 consumers (40%) with characteristics of vulnerability have disclosed their circumstances to any of their financial services providers.
But only 19% felt their provider encouraged them to do so.
The firm survey analysed responses from 725 firms.
The FCA said: “We found that taking steps to identify signs of vulnerability and encourage customers to disclose their needs was challenging for most firms. In particular, we saw this in firms that have primarily digital customer journeys.”
The FCA said that consumers may choose not to disclose for different reasons but where relevant, firms should take active steps to encourage consumers to share information about their circumstances or needs.
And it added that where consumers did disclose, some reported having to do so repeatedly because their provider failed to make appropriate adjustments.
“We found that call handlers in some firms were not using their firm’s systems to check the information recorded on a customer’s circumstances or needs.
“In some cases, this meant appropriate support was not provided, putting customers at risk of receiving poor outcomes. “
And the FCA added that in some instances, “staff did not tailor their approach for acutely distressed representatives.”
In other instances, inflexibility in processes led to staff making unsuitable suggestions or requests.
The FCA noted that in one example: “A customer was required to visit a branch to verify their identity when this was not feasible. This could leave some customers without access to bank accounts and vital funds.”
The regulator said it had also found evidence indicating limitations in the skills and capability of frontline staff and in some firms’ systems capabilities.
“In our consumer research, some consumers described feeling like their provider did not understand or empathise with their circumstances.”
Of the consumers who disclosed their circumstances, 57% felt their provider cared and 58% said their provider made changes as a result.
But some consumers were transferred to several call-handlers before receiving the support they needed.
“This made some consumers feel discouraged from disclosing their circumstances,” the FCA said.
