The FCA has published examples of good and poor practice relating to the Consumer Duty’s consumer understanding outcome.
The guidance is relevant to all regulated firms, includes extra commentary for smaller firms, and has its focus on product design, manufacture, distribution and support, as well as production of communications and customer journeys. It supports the FCA’s original Finalised Guidance for firms in relation to the Consumer Duty.
The guidance was formed using evidence to understand how firms are embedding the consumer understanding outcome, combining supervisory findings, form data, behavioural research, and extensive engagement with industry bodies, charities and consumer groups. The FCA also reviewed wider insights from its 2024 Financial Lives Survey.
In September 2025, the FCA surveyed 38 firms including insurance, retail banking, payments and consumer finance providers focusing on governance, testing, MI, communication design and support for customers in vulnerable circumstances. The sample included small, medium and large firms.
Key findings headings
- Using insight to identify where consumers struggle.
- Testing communications with real customers.
- Communicating clearly, simply and accessibly.
- Designing journeys and tools that support understanding.
- Supporting customers with characteristics of vulnerability.
- Clear, fair and balanced financial promotions.
- Governance and oversight.
The guidance is split across these 5 areas:
- Management information (MI) and testing.
- Innovation and communication design.
- Vulnerability and accessibility.
- Financial promotions.
- Governance and oversight
Firms should use this guidance to review their oversight and testing of, and processes related to the Consumer Understanding outcome.