The FCA has carried out a review of CFD providers‘ Consumer Duty compliance, specifically looking at whether they meet the price and value outcome. It included around a quarter of providers in the review. It has found some examples of good practice, but is concerned that providers may not be delivering fair value to customers.
It was pleased that some firms had simplified their charging structures, and were conscious of their responsibility to prevent customers who could not afford to lose money from entering into risky transactions in the first place.
However, on the down-side, it noted:
- that firms were not always using data from customer complaints or satisfaction surveys as a way of measuring whether they were providing fair value;
- some firms did not appear to have made changes to products or services to respond to the introduction of the Consumer Duty;
- firms that applied sometimes large overnight funding charges without adequately disclosing them or being able to justify them; and
- also on overnight funding, some firms charged overnight funding separately on matched long and short positions, which meant customers faced large charges for no apparent benefit.
The FCA will be engaging further with firms whose compliance it found to be poor.