FCA Principles and Consumer Duty explained

The FCA Principles in plain English

The Principles are high-level obligations governing matters such as integrity, skill and care, management and control, customers' interests, communications and relations with regulators. Principle 12 adds the Consumer Duty for firms and activities within its scope.

High-level does not mean unimportant. The Principles shape the standards the FCA expects firms to meet, but whether a particular Principle applies depends on the firm, activity and circumstances.

What the Consumer Duty adds

PRIN 2A sets three important cross-cutting obligations: firms must act in good faith towards retail customers, avoid causing foreseeable harm, and enable and support retail customers to pursue their financial objectives.

The Duty then focuses on four outcomes: products and services, price and value, consumer understanding, and consumer support.

These obligations operate across the customer journey, not only at the point of sale. The FCA also requires firms to monitor the outcomes customers are actually experiencing.

Consumer support can matter after the sale

The Consumer Duty is particularly relevant where the problem is not the original product but what happens afterwards: barriers to getting help, repeated hand-offs, inaccessible communication channels, poor support during financial difficulty, or processes that make it unnecessarily difficult to correct a problem or exit a product.

Where a detailed sourcebook also applies, such as CONC 7 for arrears: the specific rule usually gives the complaint more precision, while the Duty provides wider context about the customer outcome.

Dates matter

The Duty came into force for new and existing open products and services on 31 July 2023, and for closed products and services on 31 July 2024. It does not apply retrospectively to conduct that happened before the relevant implementation date.

If a dispute spans several years, separate the original event from later conduct. A product sold before the Duty existed can still involve later customer-service or support conduct occurring after the Duty became applicable.

Use the Duty carefully in individual complaints

“Consumer Duty breach” should not become a slogan added to every complaint. Identify the customer outcome that actually went wrong. Was important information unclear? Was support unreasonably difficult to access? Did the firm fail to respond to an obvious risk of foreseeable harm? Then connect that factual issue to the relevant PRIN 2A provision.

Do not assume that identifying a regulatory issue automatically creates a standalone court claim or fixes the amount of redress. The route and remedy depend on the legal and regulatory context, including whether the matter is being considered by the firm, FOS, FCA or a court.