“The topic of consumer duty is one that has dominated a lot of headlines over the last year or so – and rightly so. Ever since the Financial Conduct Authority (FCA) issued a policy statement in July 2022 regarding the final rules and guidance for the new Consumer Duty, there have been plenty of discussions around how each company will implement this.
“Having replaced Treating Customers Fairly (TCF), it aims to ensure customers receive ‘good outcomes’ and that firms provide evidence that these outcomes are being met. For us, meeting these requirements was a relatively straightforward process as much of the groundwork had already been done. Our founders Johsua Elash and Tomer Aboody have put the customer front and centre since they launched the business in 2008 and Managing Director Gareth Lewis’ appointment in May 2018 (originally as Commercial Director before his promotion earlier this year) further showed the company’s commitment to both borrowers and brokers thanks to his many years of experience working directly with consumers.
“Having joined MT Finance as Chief Compliance Officer and Head of HR in 2019, it has been interesting to see our consumer duty evolution. While the process is not largely different from before – TCF was always a key consideration – the implementation of the new Consumer Duty is going one step further. As part of our obligations under the new Duty, we have assessed all our products and concluded that they offer value for borrowers and prospective borrowers. Customer vulnerability is also a key consideration and we believe that our distribution and governance strategy is suitably robust to identify and support any clients who may need additional support.
“A large part of the new Consumer Duty also relates to monitoring and measuring customer outcomes, although we already have a process for this. Incorporating these processes into our day-to-day also signals to brokers and their clients that this is not just a tick box exercise and that it is part of the business’ DNA. This has been further cemented by my appointment to the board of directors in April as it allows me to proactively oversee the process and if there is a problem, I can question the process, review it, make changes and fix any issues where required. In some cases, we will need to be reactive, either way, consumer duty is at the forefront of MT Finance.
“As is often the case with these initiatives, this is a collaborative process. As a broker, it could also be useful for you to undertake a review of your customer journey as a way of demonstrating your commitment to good outcomes. One area that has had a lot of attention recently – and rightly so – is how the industry can best educate consumers. This is a topic we care so much about that we have supported the Financial Intermediary and Broker Association (FIBA) and the Association of Short Term Lenders (ASTL) in the creation of a new qualification; LIBF Level 3 Certified Practitioner in Specialist Property Finance (CPSP). It has been designed to raise standards and awareness across the sector, allowing for smoother processes across the specialist lending sector.
“It may have only been a matter of weeks since the new Consumer Duty was implemented but I am seeing positive signs so far. There seems to be a real buy-in across the financial services and a desire to achieve the best possible results for borrowers. This can only be a good thing, particularly in relation to consumer confidence.
“If you’d like to find out more about our Consumer Duty commitments, you can find detailed information here. Alternatively, for any buy-to-let, regulated or unregulated bridging enquiries our team can be contacted online, via email or on 0203 051 2331.”
Shyam Kotecha is MT Finance’s Chief Compliance Officer, MLRO and Head of HR. He has been responsible for shaping and implementing the business’ compliance strategy since joining in 2019. He previously held positions as a number of financial institutions including Barclays and the FCA.