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Handling Vulnerable Customers — FCA Guidelines

Overview

Under FCA Consumer Duty (PS22/9) and CONC 2A, firms must act to deliver good outcomes for all customers, with particular attention to those in vulnerable circumstances. A vulnerable customer is someone who, due to their personal circumstances, is especially susceptible to harm.

1. Recognising Vulnerability

Vulnerability can be temporary, permanent, or sporadic. The four key drivers are:

  • Health: Physical disability, severe or long-term illness, mental health conditions, addiction, low mental capacity
  • Life events: Bereavement, job loss, relationship breakdown, retirement, caring responsibilities, domestic abuse
  • Resilience: Low or erratic income, over-indebtedness, low savings, lack of support network
  • Capability: Low literacy or numeracy, poor English language skills, low digital confidence, learning difficulties

2. Indicators During a Call

Listen for verbal and behavioural cues:

  • Customer sounds confused, distressed, or anxious
  • Difficulty understanding questions or information provided
  • Mentions of recent bereavement, illness, or financial hardship
  • Requests for repeated explanations
  • Third party speaking on their behalf without clear authority
  • Signs of pressure from someone else to make a financial decision

3. Responding to Vulnerability

TEXAS Model (recommended approach):

  • Thank the customer for sharing
  • Explain how the information will be used (to provide better service)
  • Explicit consent — ask if they are happy for you to record this
  • Ask what adjustments would help
  • Signpost to additional support services if appropriate

4. Adjustments to Make

  • Slow down the conversation pace
  • Use plain language — avoid jargon and acronyms
  • Offer to send information in writing (email/letter) so the customer can review at their own pace
  • Offer a callback at a more convenient time
  • Offer to involve a trusted third party (with customer consent)
  • For financial decisions: strongly recommend independent financial advice before proceeding
  • Do NOT pressure the customer to make a decision on the call

5. Recording and Escalation

  • Record the vulnerability indicator and any adjustments made in the case notes
  • Flag the customer record with the appropriate vulnerability category
  • If the customer is at immediate risk of harm (e.g., suicidal ideation, domestic abuse), follow the Safeguarding Escalation Process
  • Route to a specialist advisor trained in vulnerability handling where available

6. Key Compliance Points

  • Consumer Duty requires firms to monitor outcomes for vulnerable customers
  • Treating Customers Fairly (TCF) outcome 6: consumers must not face unreasonable post-sale barriers
  • All vulnerability interactions should be reviewed as part of Quality Assurance
  • Failure to identify and appropriately support vulnerable customers is a regulatory risk
Keywords: vulnerable, vulnerability, FCA, CONC, duty of care, consumer duty, mental health, bereavement, financial difficulty, accessibility