Overview

This bill mandates the Financial Conduct Authority (FCA) to establish rules requiring financial firms to uphold a duty of care towards their customers in all regulated activities. This aims to enhance consumer protection within the financial services sector.

Description

The Financial Services Duty of Care Bill compels the FCA to create regulations implementing a duty of care for authorized financial institutions when dealing with consumers. This duty necessitates that these firms exercise reasonable care and skill when providing financial products and services. The definition of "consumer" aligns with the Consumer Rights Act 2015. The FCA is required to enact these rules within six months of the bill becoming law. The bill applies across England, Wales, Scotland, and Northern Ireland.

Government Spending

The bill itself doesn't directly allocate or specify government spending. However, the implementation of the new rules by the FCA may involve some administrative costs for the regulator and potentially increased compliance costs for financial institutions.

Groups Affected

This bill will primarily affect:

• Financial Institutions: Authorized financial firms will be required to comply with the new duty of care rules, potentially leading to increased compliance costs and changes to business practices.
• Consumers: Consumers will benefit from enhanced protection and a greater expectation of reasonable care and skill from financial firms, leading to potentially better outcomes.
• The FCA: The FCA will have the responsibility of developing and enforcing the new rules, requiring resources and potentially increasing its workload.

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