Three out of four dealers say Consumer Duty will create new business opportunities

Almost three out of four dealers (73%) believe implementing measures to meet the FCA’s Consumer Duty responsibilities will create new business opportunities, according to research from iVendi.

Also, 91% of iVendi’s 170 dealer customers it surveyed, agree that consumers will get a better buying experience because of the introduction of the regulations.

James Tew, iVendi chief executive, said: “We’ve been saying for some time that if dealers implement Consumer Duty correctly, it will potentially create new avenues for business. 

“That’s because it fundamentally requires detailed information to be recorded about how buyers behave and this provides greater insights, as well as providing a more structured and better-informed customer journey.”

As an example, a key metric for Consumer Duty for all dealers is that motor finance rejections should reduce over time because products should become better matched to consumers.

Tew said this process represents significant business gain.

The research also asked dealers whether they were ready to meet the FCA’s end of July deadline for new and existing products or services that are open to sale or renewal, with 97% answering yes.

When asked how far they had completed their Consumer Duty implementation on a scale of 1-5 (incomplete through to complete), 11% chose one, 11% opted for two, 35% said three, 26% picked four and 17% selected five.

Tew said: “We are sure that our research sample, which is taken from our user base, is much more Consumer Duty-aware than the dealer community as a whole because providing technology that enables compliance is very much what we deliver as a company.

“However, even bearing this in mind, these findings are a strong signal that motor retailers are taking Consumer Duty seriously and working diligently towards the deadline.

“Some may take it down to the wire, but the vast majority of dealers believe they will be compliant by the end of July.”

Last month, iVendi introduced three new Consumer Duty product bundles, created to support dealers in meeting their compliance requirements, designed to satisfy the four outcome areas while aligning sales journeys with the three cross-cutting rules.

Tew added: “There has been an immediate, positive response to these product bundles from dealers who recognise that technology is really the only route that will deliver the processes and management information that makes Consumer Duty compliance practical.”