- Consumer Duty panel, left to right: Lynda Gibson, Fleet Alliance; Jo Humphreys, the lcv group; Steve Cocks, Lex Autolease; Richard Chadwick, Alphabet; and Jo Davis, Auxillias
IT was at last year’s BVRLA Leasing Broker Conference that brokers were urged to get themselves sorted for the countdown to Consumer Duty on 31 July.
At this year’s conference (21 June 2023) a panel – hosted by the BVRLA’s Shashi Maharaj (right) – considered the actions and pain points that brokers and funders had taken.
The panel consisted of:
- Lynda Gibson of Fleet Alliance
- Jo Humphreys of the lcv group
- Steve Cocks of Lex Autolease
- Richard Chadwick of Alphabet
- Jo Davis of Auxillias
Shashi started with Steve Cocks. Steve said:
“Consumer Duty will endure beyond the July milestones, it will be the collective responsibility of us all to continually monitor our products and customer interaction to ensure that our customers can make informed decisions and receive fair value.”
Shashi then asked Steve Cocks what advice would he give to the broker network.
Think about how you currently interact with your customers and how they are supported on the journeys they follow. Review your commission schemes to ensure they do not incentivise the wrong behaviours and be consistent in your pricing to avoid inequity amongst customers with similar requirements. Finally, make sure your commission is proportionate to the support given.
Turning to Richard Chadwick, who was seconded from his head of partner role to consider the funder’s plan for Consumer Duty, he said Alphabet’s biggest pain point was falling down “a rabbit hole of vulnerability”.
But on his learnings from Consumer Duty he told brokers that they should “understand your value and document it – you do the work so spell it out. You must articulate to the customer what the product really is and what is included – including early termination and end of lease damage.”
He added that the sector was going through a time of change, with funders making changes “which you may not agree with, but they are well intentioned”.
Next was Lynda Gibson, who is head of compliance at Fleet Alliance. Lynda documented a detailed approach from the Glasgow-based broker. This included training all staff and ARs along with regular comms and procedures.
The leasing broker also invited an external company to evaluate what the business had done and to ensure nothing had been missed. “We also have board level responsibility for Consumer Duty,” she added.
The pain points for us were the differing levels of information from funder to funder. We have gone back to funders where we feel we have not had enough information. In particular, how do we share some customer information - such as health - with funders within GDPR rules?
Next up was Jo Humphreys from the lcv group. Jo explained to Shashi and delegates how the Neath-based broker had taken the opportunity to see how Consumer Duty could improve the business, even though compliance was deeply embedded in their processes already.
“We decided to look at the customer journey through every step and also consider the customer journey in-life with the vehicle. We appointed a Consumer Duty champion, we improved processes and communications to ensure we are delivering good outcomes and fair value. We are finalising our fair value statements at the moment.”
Jo admitted that Consumer Duty has been all-consuming, but she added that it was not something to be scared of, and that there was plenty of resource out there to be used.
However, admitting that it wouldn’t be popular with some sections of the audience, she said:
OEM and funder communication has been poor - at least for our panel funders - while the FCA portal is very difficult to navigate. Funders could help by delivering a fair value statement that highlighted large, medium and small brokers.
The panel was finished by Jo Davis from legal consultancy firm Auxilias. Jo – who has just been named Car Finance Personality of the Year – said that collaboration was a key aspect and that once funders had shared their fair assessments, then they needed feedback that they were ready to go.
She added that it was essential that brokers could articulate their position to customers and had MI to back up everything they did.
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Ralph Morton is the leading journalist in the leasing broker sector and editor of Broker News, the website which provides information and news for BVRLA-registered leasing brokers. He also writes extensively on the fleet and leasing market in both the UK and Europe.
