Firms' treatment of customers in vulnerable circumstances

We have reviewed how firms are supporting customers in vulnerable circumstances and whether our existing guidance is still appropriate.

We may all find ourselves in vulnerable circumstances at some time in our lives. These circumstances can affect what we need and how we engage with our financial services provider, and make us more susceptible to harm.

In this context, we want firms to act to deliver good outcomes for customers in vulnerable circumstances. We recognise this can be complex.

Last year, we evaluated firms’ actions in line with FG21/1: 'Guidance for firms on the fair treatment of vulnerable customers[2]' (the Guidance). We did so to:

Test how firms are supporting customers in vulnerable circumstances.
Consider whether our existing vulnerability guidance remains appropriate in light of the Consumer Duty[3].

We found many examples of positive actions by firms across sectors, as well as some areas for improvement.

We also saw a renewed focus among firms on delivering good outcomes for consumers in vulnerable circumstances because of the Consumer Duty.

However, we know from the Financial Lives survey[4] and new consumer research[5] which we specially commissioned that consumers in vulnerable circumstances continue to report poor outcomes when compared with other consumers.

Although our research showed that consumers were able to report good examples of firms responding flexibly to meet their needs and offer tailored support, consumers continue to report challenges, particularly if they have multiple characteristics of vulnerability.

Given the complexity and evolving nature of vulnerability, we want to work with firms to continue driving improvements in practice and outcomes.

We want consumers to receive good outcomes, consistent with the Consumer Duty.

As part of our review, we spoke to stakeholders including firms, trade associations, consumer organisations and academics. They were clear that the Guidance remains useful and important under the Consumer Duty. On this basis, we are not revising our Guidance now or introducing new requirements for firms.

Rather, stakeholders suggested more case studies would help support firms.

We have therefore published case study examples of good practice and areas for improvement[6].

Our approach

As part of our review, we gathered data to understand:

Actions firms have taken to understand and respond to the needs of customers in vulnerable circumstances.
The outcomes experienced by customers in vulnerable circumstances.
Stakeholders’ views of the Guidance, including its continuing relevance under the Consumer Duty.

Interviews with experts on vulnerability and financial services Research into experiences of consumers in vulnerable circumstances Analysis of Financial Lives survey data Firm survey Multi-firm work: outcomes monitoring Multi-firm work: power of attorney and bereavement customer journeys in retail banking

Interviews with experts on vulnerability and financial services

We interviewed stakeholders from consumer organisations, trade associations and academia to get different perspectives on:

How firms have taken action to support customers in vulnerable circumstances.
Consumer outcomes.
The effectiveness of the Guidance.

Research into experiences of consumers in vulnerable circumstances

We commissioned quantitative and qualitative consumer research, including a survey of 1500 consumers.

Read the report[5]: Improving understanding of the outcomes for consumers in vulnerable circumstances when engaging with firms

Analysis of Financial Lives survey data

We explored a broad range of poor outcomes using established measures within the 2020, 2022 and 2024 Financial Lives[4] survey data.

Firm survey

We analysed responses from 725 firms to a voluntary multiple-choice survey to identify:

Where firms have taken actions to implement the Guidance.
Patterns across different sectors.
Areas for possible further investigation.

Multi-firm work: outcomes monitoring

We sent a follow-up information request to 29 firms across 12 markets.

This request focused on how firms’ practices were affecting outcomes for customers in vulnerable circumstances, and how those outcomes were being monitored.

Multi-firm work: power of attorney and bereavement customer journeys in retail banking

We sent an information request to 7 banks and building societies about these processes, to better understand how firms manage power of attorney and bereavement customer journeys.

Our findings

Firms’ treatment of customers in vulnerable circumstances and consumer outcomes

Many firms had taken positive action and made good progress in supporting customers in vulnerable circumstances. We also saw evidence of this in our consumer research, through the positive experiences noted by some consumers.

Across our work, it was clear the Consumer Duty has driven a renewed focus amongst firms on delivering good outcomes for customers in vulnerable circumstances.

Some areas for improvement remain, particularly around products and services and outcomes monitoring.

For more detail on our findings, see our examples of good practice and areas for improvement[6].

Progress for individual firms shown in our multi-firm work is not yet showing in our UK-wide Financial Lives survey data, which indicates that consumers in vulnerable circumstances – especially those with multiple characteristics of vulnerability – may not consistently receive outcomes as good as those of other consumers.

We could not measure the impact of external factors on consumer outcomes, such as coronavirus (Covid-19) and increases to the cost of living. This may have had an impact on the Financial Lives survey data.

Effectiveness of the Guidance

Experts said the Guidance has had a positive impact on firms’ approaches, including through positive changes in firms’ attitudes, cultures and awareness regarding vulnerability and their practices.

Similarly, most firms in our multi-firm work considered the Guidance to be clear and useful in understanding how to practically apply our expectations under our Principles for Businesses.

There was also strong consensus that the definition of vulnerability is helpful, as is detail on drivers and characteristics.

Similarly, a key area of positive feedback from firms in our outcomes monitoring multi-firm work was the clarity the drivers and characteristics of vulnerability outlined in the Guidance offered and how this was used to support firms’ approaches to vulnerability. One firm considered the definition may be too broad and inadvertently capture customers who are not vulnerable, but other stakeholders advised against any change to the definition as firms have done embedding work already.

Acknowledging that the Guidance cannot, and should not try to, cover case studies for all circumstances, some firms and experts suggested potential areas for improvement, including:

Additional case studies for specific sectors and on how to treat customers with specific characteristics of vulnerability.
Further guidance on data-monitoring methods and examples of the types of outcome firms should be measuring.
Further guidance on how to treat customers who do not disclose vulnerability, both where this is detectable by the firm and in situations where firms don’t ‘have sight of’ their customers.
Referencing the intersecting impacts of vulnerability drivers and protected characteristics (race, gender, age) in the Guidance.

Relationship between the Guidance and the Consumer Duty

Overall, both firms and experts considered the Guidance and the Consumer Duty to be complementary. Some firms noted that the Consumer Duty had re-emphasised the importance of focusing on vulnerability.

In line with this, there was strong support from experts for retaining the Guidance as a separate resource, to support and complement the Consumer Duty.

Next steps

We encourage firms to make use of our examples of good practice and areas for improvement[9].

To drive further improvements, we'll continue to take account of outcomes for customers in vulnerable circumstances across our Consumer Duty work with industry.

We will also continue to engage with industry to support continuous improvement, particularly in areas that firms find more challenging when supporting customers in vulnerable circumstances.

We will not be updating our Guidance for firms on the fair treatment of vulnerable customers, as we have concluded that it remains appropriate and helpful alongside the Consumer Duty, based on feedback from this review.

03/12/2025 : System update No content change

First published: 07/03/2025 Last updated: 03/12/2025 See all updates

Firms' treatment of customers in vulnerable circumstances – review