In a financial services landscape marked by rising consumer expectations and regulatory scrutiny, firms that adapt early to change not only protect themselves, but they build trust, enhance operational resilience and gain competitive advantage. The UK’s Financial Conduct Authority (“FCA”) is now advancing its Consumer Duty (“The Duty”) agenda into its next phase, focusing not just on implementation, but on simplification, clarity and deeper integration across firms. This is an opportunity for strategic leadership and not just compliance.
The Mandate Evolves: From Launch to Streamline
When the Consumer Duty was first introduced in 2022, firms concentrated on achieving compliance, interpreting new rules, designing processes, training staff and revising governance structures. However, now that “Day One” is behind us, the FCA is signalling a move from layering regulation to simplifying it.
According to the FCA’s Consumer Duty Requirements Review Update ,published on the 30th of September 2025, the regulator is actively reviewing and streamlining its rules to reduce complexity while safeguarding good consumer outcomes. The FCA’s key objectives include:
- Greater flexibility – enabling firms to tailor approaches, particularly for customers with vulnerabilities, without rigid prescription.
- Increased predictability – providing clearer regulatory signals to support better planning and decision-making.
- Improved efficiency – reducing unnecessary burden, harmonising definitions and eliminating duplicative or outdated rules.
Recent actions include:
- Launch of a rule review feedback tool, integrated within the updated FCA Handbook website, as of September 2025, allowing firms to flag overly complex or inconsistent rules; and
- Retirement of legacy communications, by withdrawing more than 90 ‘Dear CEO’/Portfolio letters and over 100 thematic reports in order to reduce regulatory clutter.
Forthcoming plans involve:
- Consultation on clarifications, particularly concerning distribution chains and insurance co-manufacturing, throughout 2025–2026;
- Review of legacy disclosure requirements, including those related to banking, credit and APRs, to modernise and standardise approaches by 2026;
- Pilot guidance for smaller firms, supporting the transition to outcome-based regulation; and
- Potential exclusion of non-UK customers from the Duty’s scope, to mitigate cross-border regulatory friction.
In essence, the FCA is embracing a “do less, better” approach, stripping back excess, clarifying expectations and allowing firms to focus on outcomes rather than administrative box-ticking.
Spotlight in 2025–26: The FCA’s Focus Areas
Alongside its streamlining efforts, the FCA has outlined its supervisory priorities for the year ahead. The Consumer Duty Focus Areas document sets out the areas where the regulator expects firms to demonstrate meaningful progress and leadership.
Key Themes and Projects
Embedding the Duty and Sharing Best Practice
The FCA will undertake cross-firm reviews on product and service design, outcomes monitoring, customer journeys and consumer understanding. These reviews are not passive audits, the FCA may request data and offer feedback where performance is substandard.
Recognising capacity differences, proportionate guidance will be developed for smaller firms.
Vulnerability, Data and Privacy Alignment
Firms often struggle to reconcile obligations under the Consumer Duty with data protection rules. In response, the FCA and the Information Commissioner’s Office (ICO) will publish joint guidance clarifying these overlaps by Q1 2026.
Price and Value Outcome
Firms are expected to deliver evidence-based value assessments. Prompt remediation is required if customer outcomes fall short. Ongoing market studies include:
- Pure protection insurance – examining consumer behaviour and incentive structures;
- Unit-linked pensions and long-term savings – focusing on cost transparency and fair value; and
- Premium finance – evaluating whether financing insurance yields fair value for consumers.
Sector-Specific Priorities
- Retail Banking – Investigating the fairness and transparency of SME current account pricing;
- Consumer Finance – Focus on promotional credit card offers and the clarity of associated terms;
- Consumer Investments – Risk areas include poor vulnerability identification, weak value assessments and unsuitable advice;
- Wholesale Buyside – A review of model portfolio services and how they embed the Duty, with findings due mid-2026; and
- Sustainable Finance – While alignment of the Sustainability Disclosure Requirements (SDR) and investment labels with Consumer Duty is a long-term goal, this work is currently on hold.
Turning Consumer Duty into Opportunity
Firms treating the Duty as a box-ticking exercise risk falling behind. With the FCA focusing more on outcomes than processes, poor alignment across business units, unclear communications or weak value propositions can lead to regulatory penalties, reputational harm and customer attrition in a market where switching providers is increasingly easy.
In contrast, firms that embrace the Duty strategically can turn compliance into competitive advantage. Embedding consumer-centric design builds trust and brand strength. Streamlining processes reduces operational and regulatory risk. Engaging with the FCA’s reviews and pilot programmes allows firms to influence future policy. For smaller firms, proportionate FCA guidance offers a unique chance to close capability gaps and compete with larger players.
Simply put, those who lead on the Duty will not only comply, but they will also thrive.
How Complyport Can Help
The evolving Consumer Duty landscape requires more than basic compliance, it calls for strategic alignment, practical solutions and ongoing oversight. This is where Complyport adds real value, combining regulatory expertise with hands-on industry experience to help firms embed the Duty effectively, reduce risk and unlock opportunity.
We support clients by:
- Conducting Consumer Duty Health Checks: Assessing current frameworks, policies and customer journeys to identify gaps and opportunities for improvement;
- Designing and Embedding Governance: Aligning accountability structures, board oversight and management reporting to ensure outcomes remain central;
- Streamlining Customer Communications: Simplifying disclosures and testing consumer understanding to meet FCA expectations;
- Enhancing Monitoring and MI: Building outcome-focused metrics and feedback loops that give firms confidence in their compliance and insight into customer experience; and
- Preparing for FCA Engagement: Assisting with responses to consultations, data requests and multi-firm reviews, ensuring firms are well-positioned and well-prepared.
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