On 31 October 2018, the FCA published a discussion paper, DP18/9, on fair pricing in financial services.

The FCA says that the fairness of certain pricing practices in financial services is a complex issue and it wants to take into account stakeholder views on its approach so that it is confident that whatever action it takes on difficult cases is in the public interest.

The FCA is focusing the debate on the following pricing practices:

  • firms charging different prices to different consumers based solely on differences in consumers’ price sensitivity;
  • firms charging existing customers higher prices than new customers.

The FCA has concerns that these pricing practices can potentially disadvantage some consumers significantly, in particular the most vulnerable and least resilient consumers.

Comments are requested by 31 January 2019.

The discussion paper is published alongside the findings of the FCA's diagnostic work on pricing practices in the retail general insurance sector and the terms of reference for a market study on general insurance pricing practices (see below).