Car dealers who aren’t ready for the new Consumer Duty should be worried, says Auto Trader – but there’s plenty of help available for those retailers who aren’t primed, the firm has said.
The new regulations come into force on July 31 and have been designed to ‘set higher and clearer standards of consumer protection across financial services and require firms to put their customers’ needs first’, the Financial Conduct Authority (FCA) says.
The final rules and guidance were issued in July last year, so dealers should be primed for the deadline says Auto Trader’s director of automotive finance, Rachael Jones.
‘The FCA are taking this very seriously,’ she told Car Dealer Live in the video posted at the top of this story.
‘There will be severe implications for those that aren’t ready or not adhering, and the FCA have said they will act swiftly.
‘The other thing to note is that this is the start – it’s not a tick-box process to be live at the start of August with new processes.
‘It is, in a sense, but there’s an expectation to continuously look at how to create positive consumer outcomes.
‘Something that stuck in my mind was how the FCA are challenging retailers particularly around Consumer Duty.
‘They are asking retailers to think if they are putting in as much effort, time and resources into preparing their business to deliver positive consumer outcomes as they do to generate sales and revenue.
‘If this doesn’t fit with what retailers are thinking at the moment, then I’d encourage them to reach out for some support and guidance in these last few days.’
Financial media has described the Consumer Duty as one of the biggest shake-ups to retail financial services regulation, and essentially it gives more protection to the customer.
Companies offering financial products and services need to make sure they meet their customers’ needs and offer fair value. Customers also need to get the support they need when they want it.
While dealers who aren’t ready for the switch-over should be worried, there is plenty of guidance available.
‘There are lots of people offering help in the industry – I love it when everybody comes together to really look at how to overcome and prepare for these big changes. There is plenty of support available,’ said Jones.
‘From Auto Trader’s point of view, we host plenty of training sessions and share insights with dealers on lots of different topics.
‘We’ve done our own retailer-facing webinars, we’ve partnered with Auxillias – who have helped give some of those overviews in terms of compliance and the legal requirements – and we’ve published a guide.’
The guide is free and it highlights the keys things dealers need to be thinking about – you can download it here.
Elsewhere in the interview, Jones chats about:
- How Auto Trader has changed due to the new regulations
- Short- and long-term trends in the motor finance sector
- When will APR rates come down?
- Used electric vehicle prices
You can watch the full interview by clicking the video at the top of this story