Only 61% of CFDs Brokers Will Fully Comply with UK’s Consumer Duty by Deadline
- The FCA questioned 44 CFD brokers to know the industry’s position.
- 100% of CFD brokers know the requirements and understand how they will be applied.
Since the deadline of 31 July for meeting the requirements of the UK’s Consumer Duty for products and services open for sale and renewal is approaching, only 61% of the contracts for differences (CFD) providers will fully comply with all the requirements. Overall, 91% of CFD providers believe they will meet all or most of the requirements. The figure is higher than the average of 86% when considering all other sectors.
The UK’s Financial Conduct Authority (FCA Financial Conduct Authority (FCA) The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol Read this Term) has included 44 CFD brokers in the survey to understand how prepared the industry is for Consumer Duty requirements. In total, 1,230 companies across 17 sectors participated.
The CFD Industry Is Partly Prepared for Consumer Duty Rules
The report published by the FCA further detailed that 30% of CFD providers will meet most of the Consumer Duty requirements by the deadline. Another 2%of the companies believe they will comply with some requirements but will “have much work to do.” The Consumer Duty requirements do not apply to the remaining 7%.
Under the upcoming Consumer Duty requirements, companies must provide customers with products and services that meet their needs and offer fair value. Further, costumes must receive easy-to-understand communication and should get customer support when needed. These rules will be applied to products and services provided to retail and business-to-consumer customers.
Strong Awareness
Interestingly, the tightly-regulated CFD industry is highly aware of the Consumer Duty requirements, as 100% of the companies questioned by the regulator know the requirements and understand how they will be applied to their organization.
According to the report published by the FCA, 30% of the CFD industry participants ‘strongly agree’ that the long-term benefits of Consumer Duty will outweigh the short-term costs to their organization. Another 14 percent ‘tend to agree with this question, while 39 percent neither agree nor disagree. Seven percent of the CFD industry participants ‘tend to disagree’, five percent ‘strongly disagree’, and the remaining seven percent ‘don’t know’ about the long-term benefits over the short-term costs.
Furthermore, 91% of the CFD industry participants have adequate expertise to implement the Consumer Duty by the end of deadline in July, while 84% have sufficient resources.
Since the deadline of 31 July for meeting the requirements of the UK’s Consumer Duty for products and services open for sale and renewal is approaching, only 61% of the contracts for differences (CFD) providers will fully comply with all the requirements. Overall, 91% of CFD providers believe they will meet all or most of the requirements. The figure is higher than the average of 86% when considering all other sectors.
The UK’s Financial Conduct Authority (FCA Financial Conduct Authority (FCA) The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol Read this Term) has included 44 CFD brokers in the survey to understand how prepared the industry is for Consumer Duty requirements. In total, 1,230 companies across 17 sectors participated.
The CFD Industry Is Partly Prepared for Consumer Duty Rules
The report published by the FCA further detailed that 30% of CFD providers will meet most of the Consumer Duty requirements by the deadline. Another 2%of the companies believe they will comply with some requirements but will “have much work to do.” The Consumer Duty requirements do not apply to the remaining 7%.
Under the upcoming Consumer Duty requirements, companies must provide customers with products and services that meet their needs and offer fair value. Further, costumes must receive easy-to-understand communication and should get customer support when needed. These rules will be applied to products and services provided to retail and business-to-consumer customers.
Strong Awareness
Interestingly, the tightly-regulated CFD industry is highly aware of the Consumer Duty requirements, as 100% of the companies questioned by the regulator know the requirements and understand how they will be applied to their organization.
According to the report published by the FCA, 30% of the CFD industry participants ‘strongly agree’ that the long-term benefits of Consumer Duty will outweigh the short-term costs to their organization. Another 14 percent ‘tend to agree with this question, while 39 percent neither agree nor disagree. Seven percent of the CFD industry participants ‘tend to disagree’, five percent ‘strongly disagree’, and the remaining seven percent ‘don’t know’ about the long-term benefits over the short-term costs.
Furthermore, 91% of the CFD industry participants have adequate expertise to implement the Consumer Duty by the end of deadline in July, while 84% have sufficient resources.