Firms hoping that the Government’s call to boost growth through regulatory reform will mean cuts to Consumer Duty will be "disappointed", MorganAsh has warned.

The Government recently sent a letter to the UK’s regulators, including the Financial Conduct Authority (FCA), to investigate reforms to boost growth.

MorganAsh stated that the assumption among some firms is that this wouldresult in reduced regulation, particularly around Consumer Duty.

However, managing director at MorganAsh, Andrew Gething, argued that this is not only misguided, but "wishful thinking" among the firms yet to embrace the new regulation.

He referenced the reply from the FCA to the Government, which mentioned "minimal change" to Consumer Duty with the removal of Consumer Duty board champions. Instead, the letter outlined the intention to ensure that Consumer Duty is sufficient, before implementing new rules.

Gething said: "As with other regulated firms we view it as essential that regulation is proportionate, but those hoping this letter will lead to the wholesale rollback of Consumer Duty and its rules are likely to be disappointed.

"The FCA already has a remit for growth. The entire aim of Consumer Duty is to improve customer confidence in the financial services sector and to help drive sustainable growth. The FCA has cited many projects which all have a growth component and Consumer Duty is certainly one of them.

"The only real change mentioned in its letter is the removal of board champions. This is a minimal change with the need for the board to attest to complying with Consumer Duty still firmly in place. In truth, many firms had not yet implemented this anyway. The second will see Consumer Duty used as the measuring stick to determine whether any new rules to protect consumers are necessary."

The FCA also stated that growth will be a "cornerstone" of its strategy through to 2030, having previously said that Consumer Duty is a fundamental part of its regulatory framework.

Gething concluded: "Working with firms of all sizes in different sectors, we have seen those that have fully got to grips with the requirements are already understanding the competitive advantage and reaping the rewards.

"Looking beyond those regulatory requirements and seizing the opportunity requires a culture change and a transformation of processes, technology and systems to identify customers, personalise service and deliver better outcomes. Fortunately for firms, this technology is readily available in the market and is proven."

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