The FCA has published findings from its review of firms’ approaches to consumer understanding.
In September 2025, the FCA conducted a survey of 38 firms, including payments, insurance, retail banking, consumer finance and CFD firms. On smaller firms, the FCA noted that while it expects all firms to deliver good outcomes for retail customers, governance, monitoring and testing should be proportionate to the size and scale of the relevant business.
Management information and testing
Good practice in this area included using multiple sources to gain insights to understand where customers struggle, and testing communications proportionately before and after launch. Effective testing used new, outcomes-focused measures which helped firms generate meaningful metrics, identify what worked best for different customer groups, and diagnose issues earlier. The FCA also noted where testing was used to improve calculators, videos, walkthroughs or summary pages.
Areas for improvement included:
- Weak evidence of testing
- Unclear use of MI and insight
- Insufficient testing with different customer groups
- No follow-up assessment of whether changes worked
Innovation and communications design
The FCA noted that good practice involved prioritising essential information, presenting it upfront and reducing complexity. Successful firms used plain language, intuitive layout, visual hierarchy and summaries to guide customers. Effective simplification of information included not only shortening text but organising it so customers could understand and act on what was most important, such as through interactive FAQ drop downs, short summaries, clear definitions, QR-linked explanations and clear signposting.
The FCA also noted effective use of positive frictions, as well as designing for accessibility and diverse needs. Examples here included improved colour contrast, alternative formats, meaningful alt‑text, text rewrites, and layouts tested for screen readers.
Areas for improvement included:
- Cosmetic changes that do not address root causes
- Little or no testing of new designs
- Failure to adapt communications for different customer needs
- Overly long documents with limited signposting
Vulnerability and accessibility
The FCA stressed the need for proactive identification and tailored support. It noted good practice where firms embedded structural vulnerability assessments at key decision points (such as onboarding, renewal and arrears) and had accessible ‘tell-us-once’ systems which applied necessary adjustments consistently across future interactions.
Some firms also regularly tested communications with vulnerable cohorts, and some typically monitored outcomes for customers in vulnerable circumstances as a distinct MI category, such that they could correctly identify trends sooner, drive focussed change and limit harm.
Areas for improvement included:
- Reactive rather than proactive engagement with vulnerable customers
- Reliance on general knowledge without proactive mechanisms
- Limited alternative formats and assisted channels
- One-off initiatives without governance
- Initiatives without results or evidence of what has changed
Financial promotions
Good practice here included avoiding jargon, using clear summaries and making sure core messaged remained visible across mobile, email and social media formats. Effective firms also tested promotions to confirm understanding, and used clear evidence-based approval steps, keeping clear records of how wording and decisions are agreed with input from different teams.
Areas for improvement included:
- Overemphasis on benefits
- Limited or no consumer testing
- Inadequate monitoring of promotional outcomes
- Unclear, inaccessible or unbalanced messaging
Governance and oversight
The FCA highlighted the importance of clear senior responsibility, and effective governance structures that brought together the right functions to track outcomes across all products and channels. Successful firms also had clear terms of reference, structured agendas and well-documented outputs and follow-up items.
The FCA also reiterated the importance of embedding consumer understanding – and the Consumer Duty more widely – into everyday processes.
Areas for improvement included:
- Unclear accountability
- Lack of checks for different types of customers
- Weak feedback loops
- Limited use of MI in decision-making