The Financial Services Consumer Panel (FSCP) has published a position paper on banking culture. The position paper draws on a research report that the FSCP has also published. The aim of the research was to provide an understanding of what a positive banking culture looks like from a personal and micro-enterprise customer standpoint and to identify some practical measures to improve it.
Annex A of the position paper sets out 24 indicators that can be used to measure a bank’s culture from the perspective of personal and micro-enterprise customers, and to enable changes to be tracked over time.
The FSCP recommends that:
- Banks, the BSB and the CB:PSB should adopt indicators based on those identified in the Panel’s report, and use these to track changes in bank culture.
- The FCA should focus on the practical and transparent ways in which culture can be used to drive the right behaviours, for example, by monitoring these indicators to ensure that the consumer interest is taken into account.
- The Government should bring forward an amendment to the Financial Services and Markets Act 2000 (FSMA) to require the FCA to make rules specifying what constitutes a reasonable duty of care that financial services providers should owe towards their customers.
- Research is commissioned into the financial impact of bank charges and processes on micro-enterprises.
The FSCP also urge the FCA to look at work carried out in other countries on bank culture. For example, the regulator in the Netherlands says it can now see banks and insurers paying more attention to changing conduct and culture following the adoption of certain measures, including a duty of care, since 2008.