When it comes to the Financial Conduct Authority’s (FCA) Consumer Duty regulation, customer outcomes refer to the impacts that financial products and services will have on its customers. These can be either positive or negative, and include financial gains and losses, improved and reduced well-being.
If you were to help someone access finance to buy a car, they’d be able to travel to work, access education, health care, or the supermarket. However, if the cost of the loan was too high, they may struggle to make repayments, leading to financial losses, poor credit ratings, depression and anxiety.
These outcomes are important because they help regulators and firms to understand the real-life impact of financial services on their customers, identifying any risks or harms that could also come from their advice. Focusing on outcomes also opens the door for improvements to financial products and ways to mitigate the negative impacts they may have on customers.
