How speech analytics will help organisations meet FCA new consumer duty of care responsibilities

Written on
byArchie Farquharson
call centre agent

In May 2021, the Financial Conduct Authority released a consultation paper on the new Consumer Duty in an effort to “set higher expectations for the standard of care that firms provide to consumers.” In reality this means protecting customers in four specific areas: 

  • Information provided to customers to enable them to make informed decisions.
  • Fair value pricing.
  • Quality of customer service.
  • Ensuring products are designed appropriately for the target market and work as expected.

As FT advisor pointed out, when reporting on How to start preparing for the new consumer duty, a cost-benefit analysis estimates somewhere in the region of £3.6bn to be spent on implementing and embedding cultures and technologies into organisations to meet the demands of the regulations set to be published by July 2022. This cost comes as no surprise given that the FCA handed out £568m of fines in 2021. 

 

No doubt organisations will look to technology to aid in their compliance with the new regulations. Speech analytics, driven by artificial intelligence, is likely to be employed by a number of companies, not only to mitigate the risk of fines and bad press for not being compliant with FCA guidance, but more to the point to help companies set themselves apart from competitors by improving customer service and driving customer loyalty.

 

Of the four areas outlined by the FCA in their consultation paper, speech analytics offers the opportunity to ensure information provided to customers is relevant, enabling them to make informed decisions and that organisations offer a good quality of customer service. It is worth noting that whilst speech analytics has clear benefits within the new regulatory framework, its effects reach far beyond this. It will drive improvements in products, services, sales, marketing, customer experience and many other areas of business. Arguably, its most important asset is the insight into what customers truly value and deem as ‘quality’ as well as surfacing trends across different customer populations so companies can be more proactive in meeting emerging needs. 

 

One of the focuses of the pending FCA regulations is on the information provided to customers to enable them to make informed decisions. The challenge for organisations lies in monitoring employees’ interactions with consumers to ensure that the information being provided to them is correct, understandable and relevant. Speech analytics provides a solution to all three of these stumbling blocks. Key word and phrase identification gives managers the opportunity to monitor exactly what their teams are saying to consumers. For example, if agents are using too much technical jargon, making it hard for the customer to understand what is being sold to them, or if the prices the agent is offering are the right ones.

 

Prior to speech analytics software this would have had to have been done by human assessors, who typically only cover 1-3% of all consumer interactions. Automatic, machine analysis of consumer interactions gives management 100% coverage, presenting a number of upsides. Namely that of risk mitigation.  Misinformation can be identified quickly and addressed enabling customers to make informed decisions. Another benefit of great coverage is the ease with which organisations can identify vulnerable customers and make sure that the information given to them is relevant. This is hugely important as it aligns with the forthcoming regulations and FG21/1, the fair and consistent treatment of vulnerable customers. 

 

Speech analytics is likely to have its greatest impact in ensuring a high quality of customer service is provided at all times. Currently, organisations have low coverage across quality assurance functions as monitoring customer interactions using humans is labour intensive, highly inefficient, expensive and often doesn’t surface interactions that provide good learning and development opportunities. The outcome of this is that staff retention is poor at call centres and new staff are often unengaged. This all culminates in a poor customer experience. Speech analytics can combat this, providing coverage at a fraction of the human cost and in far less time. 

 

Using artificial intelligence, models can be trained to identify specific sections of interactions, complete sentiment analysis (based on the tone, speed and language used) and evaluate advisors’ overall soft skill abilities through a range of metrics (number of interruptions, talk time %, call duration, complaint identification). These metrics can then be used to implement data driven learning and development programmes that drive positive in the quality of customer service. For example, interactions with particularly positive outcomes for both the customer and the company can be identified and analysed to see what constitutes an excellent interaction. Consequently, these calls can be used as coaching benchmarks for the rest of the team, raising overall performance. 

 

The benefits of speech analytics in creating a more transparent and higher standard of customer care are evident. Early adopters of this technology have the opportunity to mould it into a product that best suits them and their customers with regard to the new consumer duty guidance. From day one, organisations can achieve up to six times greater efficiency in their quality assurance process, but in a year they could achieve far greater gains. Furthermore, the nature of machine learning means that the more the technology is used, the more valuable it becomes as the model learns the language and structure of interactions. This means insights into agent performance and customer experience will be vastly more effective as time goes on.   It should come as no surprise if we see speech analytics take off in the next few years as organisations try to implement technologies and cultures that align with the pending legislation. 

 

To find out more visit our website and find out what we can do for you…

 

Other recent posts

Forging a fairer way forward after the FCA’s ‘Dear CEO’ letter to Retail Lenders

Forging a fairer way forward after the FCA’s ‘Dear CEO’ letter to Retail Lenders

The rising cost of living has led to lending firms facing an increasing number of vulnerable customers, as more borrowers struggle with their personal finance. Consumers are experiencing growing financial pressure leading to a...

5 ways Financial firms can improve consumer understanding

5 ways Financial firms can improve consumer understanding

Ensuring consumers are provided with the information they need, in a way they understand to make informed decisions about financial products and services is no longer optional. The FCA has made this clear in...

Aveni secures £2.75M investment to expand AI platform

Aveni secures £2.75M investment to expand AI platform

We’re excited to share, that we’ve secured an investment of £2.75 million to deliver the expansion of our Aveni Detect platform to the financial services and utility markets across the UK. The ground-breaking conversational...

How firms can apply Consumer Duty of Care to Existing Services

How firms can apply Consumer Duty of Care to Existing Services

It’s no longer news that the FCA announced the new Consumer Duty of Care (CDC) proposal to help provide a higher standard of service and fairer outcomes for customers. While it may be easier...

The big fat Aveni reunion!

The big fat Aveni reunion!

Working remotely comes with so many positives, but sometimes, you need a change from working by yourself all day and having such easy access to the fridge and all the calories that lie within....

7 critical actions to take from the FCA’s Consumer Duty Consultation and how speech analytics can help achieve them

7 critical actions to take from the FCA’s Consumer Duty Consultation and how speech analytics can help achieve them

Financial Service firms need to rely on more than just human resources to implement the new FCA’s Customer Duty of Care rules and guidelines by April 2023. Deloitte recommended the following critical actions, and...

Why Board Members Should Prepare for the Consumer Duty of Care Changes

Why Board Members Should Prepare for the Consumer Duty of Care Changes

The FCA’s new Consumer Duty of Care proposals have been causing a bit of controversy since they were first announced in December last year. Although the aim is to help provide a higher standard...

Ramadan Diaries with Hayfa Bukhari

Ramadan Diaries with Hayfa Bukhari

In this blog, I explain what Ramadan means to me and what a typical day looks like during this time. I’ve written this blog before Ramdan starts so it gives you an idea of...

How Your Business Can Prepare for the FCA’s New Consumer Duty of Care Proposals

How Your Business Can Prepare for the FCA’s New Consumer Duty of Care Proposals

If you’re struggling to understand how to show regulators that your business is compliant following the FCA’s recent Consumer Duty of Care proposals, you’re absolutely not the only one.    Aimed at bringing in...