Dealing with Consumer Protection in 2021

Renewed regulatory, government and media scrutiny of the conduct of financial services firms is bringing consumer protection issues and challenges to the forefront.

The consumer protection landscape is evolving rapidly. Changes are being driven by the COVID-19 pandemic and increased digitalisation, coupled with specific focus on some areas such as differential pricing and vulnerable customers.

Firms need to demonstrate their readiness to respond with efficiency and agility to existing and emerging risks. Our Risk team explore the issues below.

Background to the Consumer Protection Outlook Report

The Central Bank of Ireland (hereinafter “CBI”) released its 2021 Consumer Protection Outlook Report in March. The report details the main risks facing firms across all financial sectors, with the CBI setting expectations that firms examine each risk and take all the appropriate actions to protect against potential consumer and investor harm. The report identifies the following crosssectoral risks:

Absence of consumer-focused culture;
Consumer protection during the COVID-19 pandemic;
Ineffective disclosure;
Unfair practices and behavioural vulnerability;
Risks from technology; and
Mis-selling and inadequate suitability assessments.

The CBI establishes six key priorities to ensure that firms mitigate risks faced by consumers and investors, however the report also highlights the importance of flexibility and responsiveness to unknown risks such as those that emerged as part of the COVID-19 pandemic. The six areas the CBI prioritised are to:

Deliver intrusive risk-based supervision;
Enhance the consumer protection framework;
Drive firms to embed effective consumer-focused cultures;
Influence, shape and deliver key policies for regulation;
Ensure the fair treatment of borrowers in financial distress; and
Enhance the gatekeeping process.

Dealing with Consumer Protection in 2021

Download

Get in touch

COVID-19 is challenging leaders like never before. To find out more about how KPMG perspectives and fresh thinking can help you focus on what’s next for your business or organisation, please get in touch with our team below. We’d be delighted to hear from you.