Firms must change their culture and behaviour to comply with Consumer Duty rules

by Jyoti Rambhai

Share this post

The UK’s financial watchdog has warned that e-money firms must undertake a “significant shift in culture and behaviour” if it is to comply with the new Consumer Duty rules, due to come into force in July.

The Financial Conduct Authority’s (FCA) Matthew Long, director of digital payment and digital assets, wrote a letter to the chief executives of payment institutions and e-money companies last month (February), criticising them for “poor” financial crime and fraud controls.

In the letter, seen by Payments Review, Long states: “For many firms, meeting the [Consumer] Duty will require a significant shift in culture and behaviour.”

“We recognise that the implementation of the Duty comes at a challenging time. However, we believe that embedding the Duty effectively will help payments firms continue to build trust amongst customers,” he adds.

He raises concerns about the continued “poor financial crime controls” in some firms and urges them to consider the impact of freezing individual customer accounts, which is usually when a financial crime is suspected.

“That is a reasonable principle,” Long writes. “But in practice, some firms freeze a disproportionate number of accounts, for too long, and without adequate explanation.”

Long emphasises the FCA’s expectations on business to make the new rules a “top priority” and has sent similar letters to chief executives of companies across all sectors.

The letter comes just one month since the watchdog warned that some businesses are falling behind and failing to allocate adequate technology resources to prepare for the new regulation.

Many organisations in the sector have allegedly complained about the administrative burden of preparing for the Consumer Duty rules.

As a result, Andrew Griffith, City of London minister, is claiming that this could damage the sector and trigger a serious of lawsuits.

According to the Financial Times, Griffith is concerned the changes will “impose regulatory burdens on the financial services industry at the time the Treasury is trying to relax some of the City rules as part of a ‘Brexit opportunity’”.

Alison Donnelly, director at FSCom, also stresses that businesses are feeling the burden of becoming compliant.

“Some firms may have to do a material amount of work to be ready and to be able to evidence and what they’ve done. But I think there are some who might have missed how much there is to do,” she tells Payments Review.

For those firms at risk of falling behind, Donnelly advises they need to have a “high-level cultural understanding” of the rules and make it a priority.

“The key thing here is the significant uptake on the expectations for the payments sector, because it hasn’t had a bill like this before,” she adds.

More To Explore


Are you a member of The Payments Association?

Member benefits include free tickets, discounts to more tickets, elevated brand visibility and more. Sign in to book tickets and find out more.


Log in to access complimentary passes or discounts and access exclusive content as part of your membership. An auto-login link will be sent directly to your email.

Having trouble signing?

We use an auto-login link to ensure optimum security for your members hub. Simply enter your professional work e-mail address into the input area and you’ll receive a link to directly access your account.

First things first

Have you set up your Member account yet? If not, click here to do so.

Still not receiving your auto-login link?

Instead of using passwords, we e-mail you a link to log in to the site. This allows us to automatically verify you and apply member benefits based on your e-mail domain name.

Please click the button below which relates to the issue you’re having.

I didn't receive an e-mail

Tip: Check your spam

Sometimes our e-mails end up in spam. Make sure to check your spam folder for e-mails from The Payments Association

Tip: Check “other” tabs

Most modern e-mail clients now separate e-mails into different tabs. For example, Outlook has an “Other” tab, and Gmail has tabs for different types of e-mails, such as promotional.

Tip: Click the link within 60 minutes

For security reasons the link will expire after 60 minutes. Try submitting the login form again and wait a few seconds for the e-mail to arrive.

Tip: Only click once

The link will only work one time – once it’s been clicked, the link won’t log you in again. Instead, you’ll need to go back to the login screen and generate a new link.

Tip: Delete old login e-mails

Make sure you’re clicking the link on the most recent e-mail that’s been sent to you. We recommend deleting the e-mail once you’ve clicked the link.

Tip: Check your security policies

Some security systems will automatically click on links in e-mails to check for phishing, malware, viruses and other malicious threats. If these have been clicked, it won’t work when you try to click on the link.

Need to change your e-mail address?

For security reasons, e-mail address changes can only be complete by your Member Engagement Manager. Please contact the team directly for further help.

Still got a question?