The Financial Ombudsman Service has started to receive complaints where it has to consider the consumer duty, with the new regulations expected to play more of a role going into the new year.
Speaking to FTAdviser, Abby Thomas, chief executive and chief ombudsman, said various regulations could shake up the Fos' role.
She said: “Looking ahead, we expect the Financial Conduct Authority’s consumer duty, introduced in July, to drive up standards for businesses.
“We have started to receive complaints where the duty might be a consideration, and we will continue to engage with firms and the FCA through the year.
“On consumer credit, the use of buy now pay later products continues to rise, and the scope of potential regulation is still to be finalised, as is the date when regulation may come into force.”
It was also recently revealed that the Fos will be given the power to charge case fees to claims management companies which bring cases to the service on behalf of clients.
HM Treasury published a statutory instrument which will give it powers to set the scope of who the Fos can charge fees to.
The Fos will then be responsible for making decisions as to who is charged, within the scope of those rules.
As part of this, the Fos could charge case fees to CMCs from 2024.
“As part of our plans and budget consultation, we are seeking views on whether and how a charging regime might be implemented,” Thomas said.
“It is important to stress that our service will remain free and easy to use for all consumers who bring complaints directly to us.
“However, 20 per cent of cases are brought by representatives, some of whom benefit commercially, so it is right that we explore whether to use the new powers granted to us.”
She said plans for the year ahead will help ensure that the customer is at the heart of everything it does.
“It is crucial that businesses work with us to improve all customers’ experiences of financial services.”
Transformation
In 2023, the Financial Ombudsman Service set out to deliver significant change, according to Thomas.
She said when she became CEO - just over a year ago - she was conscious of the “vital role” the Fos plays in resolving financial disputes.
“However our single highest priority was to increase the pace at which we resolve complaints, without compromising the quality of our work,” she said.
In the past year, she said the Fos has tried to improve its service with the launch of a three year strategy and investing in capabilities such as data and analytics and forecasting and planning teams.
The Fos has also developed a suite of digital tools to support self-service for consumers and assist caseworkers.
Thomas said these are innovated using machine learning to support its complaint categorisation and specialist teams.
As a result, the average time it takes to resolve a case has halved over the past 12 months, she explained, while the quality scores have gone up.
