Advice – Guidance – Gamification
Peter Smith
UK Fintech Ambassador at TISAtech (Tt). Industry Consultant. NED. Regulatory Horizons Envoy. Adviser Technology Legate TechFin Atelier.
Advice – Guidance – Gamification
When we started the industry wide Savings & Investment Project with the coalition Government in 2015, one of the key project groups spent a lot of time with Government & Regulators looking at the “advice-gap”, Robo-Advice and D2C with a view to review the legislative framework around firms’ permissions to deliver financial advice & guidance to consumers.?The struggle always was the advice – guidance boundaries & where the liability sat for consumers decisions based on advice or guided information and where the responsibility sat.
Advice firms found it very difficult to provide D2C or guidance based on?prompts, nudges, alerts, and guided “information” which STILL firms are currently not allowed to deliver to unadvised people as financial guidance.
No surprise then that evolving digital financial advice mechanisms or “gamification has once again come under the regulatory spotlight.
?Whilst?#gamification?can be used to engage consumers positively, FCA have found it being used in ways that may mislead consumers or lead to poor outcomes and problem behaviours. (RDR was always outcomes focussed)
With an unprecedented shift towards?digitalisation in financial services during the Covid-19 pandemic, policymakers are increasingly concerned that online businesses can manipulate consumers in new ways and more easily than ever before.?The FCA’s new consumer duty calls out harmful ‘sludge’ design practices – excessive frictions that prevent consumers making decisions in their own interest. It’s?2022/3 business plan?sets out its commitment to ‘shaping digital markets to achieve good outcomes’.
So, to this end we now have?The FCA taking steps to follow up with some of the firms whose trading apps were reviewed and has stated that 'some product design features could be contributing to problematic, even gambling-like, investor behaviour. FCA expect all firms that offer stock trading to consumers to review and, where appropriate, make improvements to their products based on their findings. They should also ensure they are providing support to their customers, particularly those in vulnerable circumstances or those showing signs of problem gambling behaviour. To ensure customers are being treated fairly and ahead of the new Consumer Duty coming into force next year, all firms should be reviewing their products now to ensure they are fit for purpose.'
领英推荐
Read more at the 2 following links:
@TheFCA Financial Conduct Authority TISAtech (Tt)
RiskTech?#Fintech?#financialtechnology?#wealthmanagement #FinancialServices #SupTech #OperationalRiskManagement #GlobalRegulations #GFIN #FSMB?#TechFin?#RegTech#FinancialServicesAI?#ML?#RiskControls #RegulatoryHorizons #RegulatorySupervision #GreenFinTech #SuitabilityFintech #SupTech?#financial #supervision #RoboAdvice?#DigitalAdvice