When Bill C-86 was passed into law in Canada nearly a year ago, in December 2018, it incorporated the Financial Consumer Protection Framework (FCPF) as a consolidation of new and enhanced provisions to increase consumer trust in the financial system.
These highly anticipated regulatory changes, finally due to be released imminently, signal heightened expectations for the fair treatment of consumers. Among the provisions set out in the FCPF are new requirements for improved disclosure, changes to express consent requirements, changes to customer cancellation rights, and redress protections.
Among the most significant changes are the requirements concerning handling consumer complaints. The objective of these provisions is to require greater transparency, fairness, and swiftness so that consumers can have greater trust that their concerns are being taken seriously and resolved effectively. Indeed, in the Domestic Bank Retail Sales Practices Review, the FCAC noted while approximately 90 to 95 percent of consumer complaints are being resolved at the first point of contact as part of good customer service, these complaints are generally not being logged. This weakens a bank’s ability to identify trends and remedy the root cause. The new provisions impose documentation standards, which will dramatically change the amount of information on which institutions can draw to see new patterns and insights.
What should bank leaders be doing right now? Here are some thoughts on where to direct your attention:
Above all, banking leaders need to examine how the rising standards of consumer protection create an opportunity to strengthen the bond of trust with customers and increase the long-term value of these relationships.
Seek assistant to help you identify whether the requirements and standards of the Financial Consumer Protection Framework may apply to your business and help you address the challenges of evolving regulatory compliance, corporate governance, and risk management matters in the financial services industry.
Partner, Risk Advisory
Tel : 416-874-3477
Senior Manager, Risk Advisory