Research reveals TCF is now the top regulatory and risk priority
Treating Customers Fairly (TCF) is now the number one regulatory challenge and also the greatest area of regulatory risk for more than 80% of the UK's financial services firms, according to new research released by the Financial Services Discussion Club (FSDC) and leading business and financial adviser Grant Thornton.
The report, which surveyed senior managers in 75 financial services firms including retail banking, pensions, general insurance, investment banking and asset management, found that 83% of respondents cited TCF as the top risk and regulatory priority in the year ahead, followed at a distance by financial crime and data security.
Conducted by Clearconcepts, in association with Grant Thornton, the research demonstrates the push that the financial services sector has made to ready itself for the TCF deadlines, both later this month and in December. It also highlights the level of risk that firms believe the FSA's enforcement of TCF may hold for their businesses.
Ian Gorham, Head of Financial Services at Grant Thornton, said it was clear that the media had been increasingly important in agenda-setting, and financial services firms should expect continuing media scrutiny in the coming 12 months.
The research found that 91% of firms do expect to be ready for this month's TCF deadline set by the Financial Services Authority (FSA). However, management information (MI) was still identified as a challenge within TCF implementation, and also for MiFID firms.
Gorham continued, "There is some valid concern about whether the FSA and firms will have common expectations around TCF. This remains a key area of risk, and firms need to be doubly sure they have properly assessed and recorded their progress and successes. They should also ensure that solutions firms have come up with to TCF issues are right for their business. ."
The research highlighted payment protection insurance (PPI) would be the product type that received greatest scrutiny in the coming year, while product performance and bank charges were also set for increased interest.
Naomi King from Clearconcepts, which administers the FSDC, said: "TCF dominated agendas in the past year and it's no surprise that it's the top priority for firms in 2008. Similarly PPI, financial crime and MI have increasingly featured at club meetings and look set to feature more in the coming year."
