Alphera doubles down on Consumer Duty with proactive promises

Alphera Financial Services is “doubling down” on Consumer Duty by launching six new promises for partners and consumers a year on from the launch of the Financial Conduct Authority (FCA) initiative.

Consumer Duty+ is a new code of excellence that is being rolled out to Alphera partners and defines six promises (below) which the finance provider said encourages clarity and consistency, with a focus on specific processes and outcomes that its partners can embrace.

Adopting the Alphera Consumer Duty+ Code of Excellence is voluntary and the firm is inviting its 1,200 dealer and broker partners to sign up and show their support.

A number of Alphera's partners, including Marriott Motor Group, Octane Finance, Howards Motor Group, VR EPS Warrington, Phantom Motor Company, Eastern Western Group and Hippo Motor Group, have already committed to the code prior to its launch.

This new initiative will be an ongoing process that will continue to evolve and is part of Alphera’s approach to be proactive, rather than reactive to the FCA’s guidance.

Alex Royall, Alphera UK director, (pictured) told AM: “Consumer Duty is not a tick box exercise and our new initiative is a good way to mark the anniversary and show that we’re constantly reviewing and evolving what we do.

“We want to keep Consumer Duty at the forefront of our partners’ minds. Consumer Duty+ is about being even more transparent with our partners and removing any ambiguity.

“Our true partners are on the same page."

A year of Consumer Duty

The FCA's Consumer Duty was introduced last summer to set higher and clearer standards of consumer protection across financial services, and requires firms to put their customers’ needs first.

Royall said consumers may not have noticed too much of a difference with Consumer Duty in terms of how it may have affected their experience, particularly if finance is being provided by a professional operation that has embraced the guidance and was always keeping customers' best interests in mind.

However, Royall acknowledges there has clearly been pressure on retailers and firms from the high profile media coverage around complaints on historic discretionary commission agreements (DCAs), as well as the FCA's spotlight on GAP insurance.

The FCA recently announced the results of its review into historic DCAs would be delayed from September this year, until May 2025.

It's now likely there will be a structured FCA redress system put in place for consumers in relation to historics DCAs, although no final decisions have been made yet.

Royall said: "We're very comfortable with our pricing strucutres and knowing that our products and services represent fair value.

"However, it's clear the coverage from Martin Lewis, Moneysavingexpert and claims management companies (CMC) has meant the sheer volume of complaints around DCAs has created a pressure point for the industry as a whole.

"But I honestly don’t think it’s detracted from the overall perception of our industry.

“I think where we are now is a much better place than it's ever been."

The Consumer Duty+ promises:

• We are committed to the continuous improvement of our services in line with Consumer Duty
• Ensuring ‘good customer outcomes’ is at the heart of everything we do
• We empower customers to make informed decisions by giving them the right information at the right time
• We can demonstrate that our prices represent fair value for every customer
• We recognise that every customer is different
• Our duty of care to customers continues for the lifespan of the finance agreement and beyond