Vulnerable Customers

1.0 Introduction

Everybody has the potential to become vulnerable at some point in their lifetime. It is therefore certain that we will have dealings with customers who are experiencing vulnerable circumstances during the course of our business.

As a business authorised and regulated by the FCA for our credit broking activities, it is important that we have a suitable policy in place, and that our staff understand how to identify vulnerability and how to adapt their dealings with vulnerable customers to meet their needs and achieve fair outcomes.

Vulnerable customers are likely to need additional assistance at some stage in order to avoid detriment (financial or psychological) when applying for finance.

The purpose of this policy is to ensure that the way in which we conduct our business does not have a negative impact on vulnerable customers.

A vulnerable customer is defined by the FCA as “someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with the appropriate levels of care.”

We are committed to ensuring that all staff involved in the sale of products or services where finance is available, are capable of identifying vulnerable customers, and that they can handle a situation involving a vulnerable customer with the required levels of care, attention, and respect.

A customer may find it difficult to make an informed decision about their available options for a variety of reasons. The risk factors that contribute to vulnerability in financial services include:

• low literacy, numeracy and financial capability skills

• physical disability

• severe or long-term illness

• mental health problems including common mental disorders

• low income and/or debt

• caring responsibilities (including operating a power of attorney)

• being elderly, although this is not absolute (may be associated with cognitive or dexterity impairment, sensory impairments such as hearing or sight, onset of ill-health, not being comfortable with new technology)

• being young (associated with less experience)

• change in circumstances (e.g. job loss, bereavement, divorce)

• lack of English language skills

• non-standard requirements or credit history (e.g. armed forces personnel returning from abroad, ex-offenders; care-home leavers, recent immigrants).

Living with a disability, illness or diagnosis does not in itself make someone vulnerable. In the context of financial services, it is the person’s situation and barriers to accessing such services that may make them vulnerable. Equally a person may be vulnerable without any disability, illness or diagnosis, for example if they are recently bereaved or frail.

Vulnerability is not necessarily a permanent state. Vulnerability can come and go, be short-term and temporary, long term or in some cases, permanent. Each customer’s vulnerability will be unique to them and so it is important that our staff adapt their communication and actions appropriately, based on each individual customer’s needs.

2.0 Identifying Vulnerable Customers

For our staff to correctly address the needs of a vulnerable customer, it is important to be able to identify them.

The customer may have indicated one or more of the risk factors referred to above, or one or more of the following indicators may become apparent during a telephone or webchat conversation or face-to-face in store:

a) Can the customer hear everything you are saying and do they understand what you are saying? Do they ask you to slow down or to speak louder? Are you sure they have heard and understood all the relevant details? Do they ask you to clarify any details or advise they do not understand terminology being used?

b) Does the customer stay on topic and hold a conversation that is coherent, or do they appear distracted or confused? Do the customers responses remain relevant and are their questions typical for the discussion being had?

c) Does the customer take an unusually long amount of time to answer a question that suggests they are struggling to process the information provided to them?

d) Does the customer indicate they may have a disability or impairment based on their voice, pronunciation, breathing, hearing or ability to understand the conversation? Are they coherent and fluent in the language being used?

3.0 Dealing with Vulnerable Customers

Just because somebody is vulnerable does not automatically mean that they are unsuitable for our products and services, or that they will not be able to obtain finance. As soon we think we may be engaging with a vulnerable customer we should take care to adhere to the requirements set out in this policy.

When dealing with vulnerable customers staff must be aware of the following guidelines:

a) Remain patient and empathetic; do not rush the customer, interrupt or appear impatient. Allow the customer to arrive at their own decisions and process the information sufficiently.

b) Ensure the customer is able to hear and understand what you are saying; ask the customer to explain their understanding of what you are telling them, or include questions as frequently as possible to ensure they are aware of and understand what is being discussed.

c) Allow the customer to explain thoroughly; do not assume you already know what their requirements or needs are, and do not finish off their sentences which often implies you are rushing them to progress the conversation. Listen carefully to the customer and remain conscious of any absence of understanding, hints at unawareness, or forgetfulness of topics already discussed.

d) Clarify that the customer is comfortable with the standard and method of communication and offer to provide details in an alternate format such as via post or email for clarity.

When a vulnerable customer has been identified a relevant note should be added to their record in our finance provider(s) BackOffice system to ensure awareness extends to all staff within the company, at our finance provider(s) and the Lender who may deal with the customer. It is important that we maintain a consistent level of service, and that a vulnerable customer receives adequate care irrespective of which staff they liaise with. Any such notes should describe the reasons for the assessment of the customer as vulnerable and be factual, concise, not excessive and confirm that consent has been taken to record the information.

TEXAS Drill

If a customer discloses information about their vulnerability it may include ‘special category’ data, which requires us to implement additional controls under the UK GDPR. The TEXAS drill is a simple, yet effective way to treat a customer fairly, record relevant information and comply with our obligations under the GDPR:

- Thank the customer for sharing the information with you.

- Explain to the customer how you will use that information and who it will be shared with (i.e. our finance provider(s) and the lender(s))

- Gain eXplicit consent from the customer to record the information and use it as explained to them. Without this, you will not be able to record details about the customer’s vulnerability.

- Ask up to three questions to help understand more about the customer’s vulnerability:

1) How does your situation make it difficult to manage your finances?

2) Do you have any specific communication needs or preferences that we can share with your lender to help them meet your needs?

3) Do you have anyone who could help you with deciding about whether to apply for finance?

- Signpost the customer to sources of free and independent help and support if appropriate, such as their local Citizens Advice Bureau, the Money Advice Service, Mind or the Samaritans.

Mental capacity

Mental capacity relates to the ability of the individual to understand and to retain and evaluate relevant information to be able to make a decision based on that information.

If a member of staff believes that a vulnerable customer is unable to make a decision for themselves regarding their insurance, they should attempt to identify a carer or next of kin who is authorised to act on their behalf with respect to their financial affairs. in many cases, a parent or spouse will represent the interests of the vulnerable customer.

Product Information and Financial Promotions

We acknowledge that there are limits to what we can reasonably do to form a view as to whether a customer is in a vulnerable situation, especially when they follow an online journey on our website.

However, it is good practice in product information and any financial promotions, whether online, in-store or over the telephone, to be clear, concise and transparent with customers about the key features of the financial services. As a responsible credit broker, we are committed to meeting high standards of customer communication and will always adhere to the content requirements stipulated by our finance provider(s) and/or our lenders.

Where our staff may engage with customers about finance, those staff will only be permitted to do so once they have successfully completed the relevant training and acknowledged that they have read and understood this policy.

Our Commitments to Treat Vulnerable Customers Fairly

To ensure we treat vulnerable customers fairly, we will take the following actions:

- All employees are given initial training in identifying and dealing with vulnerable customers

- All employees will be provided with ongoing training and regular updates to ensure employees continue to implement our policies

- Our systems will facilitate the identification of vulnerable customers where possible

- Our systems will enable us to deal with vulnerable customers in the most appropriate manner, so their needs are met

- The needs of vulnerable customers will be factored into the service provision and design of the products we offer

- Our policies will be clear to customers, and to the third-party organisations we deal with, including our finance provider(s)

- Management information will be used regularly to review and improve our policies and procedures

- We will ensure the proper recording and reporting of information with the customer’s explicit consent; We will bring this to the attention of our finance provider(s) and the lender(s), where the customer has given consent, and

- We will ensure that the customer has understood the advice and information made available to them, prior to deciding whether to apply for finance.