FCA publishes consumer understanding good practice and areas for improvement

TLT picks out the key points you shouldn't miss...

What’s this about?

On the 13th of March 2026, the Financial Conduct Authority (FCA) published the findings of its review into regulated firms’ approaches to consumer understanding. The review focused on the overarching customer support requirements of Consumer Duty across five areas: management information & testing, innovation & communication design, vulnerability & accessibility, financial promotions, and governance & oversight. The aim is to provide firms with examples of effective and substandard practices to help them learn and improve consumer understanding in their area(s).

Our Head of Financial Regulation, Amanda Hulme says...

“Effective delivery of the consumer understanding outcome under the Consumer Duty is of paramount importance, and these findings provide helpful guidance to make that delivery as clear and accessible as possible”.

The points not to miss...

Broad application no matter what size of firm you are

The review findings are relevant to all firms that provide products or services to retail customers.
FCA expectations apply to firms of all sizes, whilst approaches may be proportionate to a firm’s scale and resources – throughout the findings the FCA give various examples from smaller firms – trying to argue you couldn’t adapt due to being small won’t cut it!
Saying you are just part of the chain won’t cut it either - firms that design, manufacture, distribute or support products and services are caught by these findings. The FCA has an eye on communications and customer journeys that affect how customers understand information and make decisions.
The findings are cited as being useful to industry bodies, consumer groups, charities, policymakers and other stakeholders who want to improve customer understanding across financial services – the findings could be quoted back to you in a complaint so make sure you are aware of the expectations.

Lots of examples to learn from

Looking at the webpage you could think that the FCA published a short page of findings - if you click into the tables there is a lot of detail.
If this were a PDF report the findings would come to between 17-20 pages.
There are a lot of examples that the FCA expect you to have taken on board – ensure these examples are cascaded to the relevant teams in your business.
One of the key findings being that good practice includes clear ownership of the consumer understanding outcome. Oversight should be embedded into everyday business processes - it isn’t for products or digital or user design or risk or legal to look at in a silo!
If you have anyone in your business struggling to translate Consumer Duty into business as usual (BAU) action show them the examples in these findings to bring things to life.

Main takeaways of good practice

Use multiple sources for insight: You should have access to call listening, complaints, chat transcripts, drop-off data and surveys. You should review all of these insights regularly. Don’t just assume you know what customers think, use the real evidence that you have. Don’t just use the same source you’ve always used.
Willingness to review insights and adapt purposefully: You need to be willing to test and review your communications and communication mechanisms to enhance customer understanding and make purposeful changes.
Challenge bare minimum “simplification”: Simplification isn’t only about writing in plain English and reducing your word count. You need to think about how the information is organised and presented and where interactive elements improve understanding.
Positive friction as a tool: These findings build on the Digital Design findings, you should include deliberate pauses to help customers slow down and avoid snap decisions preventing harm – not every journey is about “time to cash” and you may need to battle your UX/ UI teams on this point to improve things for customers.
Tailor designs for customers with varying needs across appropriate channels: Designs need to take into account vulnerability flags, reasonable adjustments and low digital confidence. These findings echo the findings in the Digital Design and Vulnerable Customer Consumer Duty publications. It’s worth going back to review the Vulnerable Customer examples in particular.
Ownership of the consumer understanding outcome: Good practice involves unambiguous ownership of the consumer understanding outcome with effective oversight and clear lines of responsibility constituting part of the daily inner workings of the firm’s business. Read these findings in conjunction with the Board Report Consumer Duty publication.

Key deficits to be improved

Lack of appropriate testing: Testing of communications needs to be thorough, documented and inclusive to allow them to be improved effectively. Test a range of cohorts. If you fail to test communications for those with accessibility needs, you could completely miss that a screen reader is failing in one section of a journey, and certain customers have been provided with no accessible information on fees and charges – increasing the risk of harm to this group.
Poor use of MI and insights: If you are collecting data about drop off rates then use that data to improve things, don’t collect data for the sake of it. Ensure you are clear on why the data is relevant, who is reviewing it and how action points are escalated.
Cosmetic changes that fail to address root issues: Poor practice includes making superficial changes (i.e. shorter word counts, new icons, etc) that fail to improve clarity of communication, accessibility or customer experience in another way.
Insufficient availability of alternative formats: In order to improve delivery of the consumer-understanding outcome, it is imperative that the necessary alternative formats are provided. This includes readability testing as well as addressing concerns regarding digital capability.
Move from being reactive to proactive: The FCA found that firms had vague and underprepared policies and processes. It also found ad-hoc improvements that weren’t embedded properly. Don’t lose good work by failing to put in place proper controls and scrambling around for evidence to prove sustainable improvement.
Follow-up: If you spot an issue and make a change, go back and check if the change has worked. If it hasn’t worked, or reduced understanding, you need to know this so you can understand why and make further changes.

Publication link	Consumer understanding: good practice and areas for improvement \| FCA Other links referred to: Digital design in customers' online journeys: good practice and areas for improvement \| FCA Delivering good outcomes for customers in vulnerable circumstances – good practice and areas for improvement \| FCA Consumer Duty board reports: good practice and areas for improvement \| FCA
Published date	13 March 2026
Who has published it?	Financial Conduct Authority
Publication type	Report
Any key dates?	N/A
What's it relevant to?	Consumer Duty, Consumer Understanding Outcome

Authors: Hannah Yeager and Catherine MacPherson

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at March 2026. Specific advice should be sought for specific cases. For more information see our terms & conditions.

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Date published

27 Mar 2026