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Dear CEO/Director | Release Date: 3rd March 2023

To read a shorter summary of this Dear CEO/Director letter, click here.

To access the original FCA document, click here.

Long Summary

The Financial Conduct Authority (FCA) is ushering in a significant paradigm shift with the introduction of the Consumer Duty, aimed at enhancing consumer protection through a more outcomes-focused approach. This communication is specifically directed at firms within the Motor Finance Providers portfolio, emphasising the critical need to integrate these new standards effectively.

Implementation Timeline

The FCA has established a timeline for the rollout of the Consumer Duty:

End of October 2022: Firms should finalise their implementation plans.

End of April 2023: Necessary reviews by manufacturers to comply with outcome rules should be completed and shared with distributors.

31 July 2023: The Consumer Duty becomes applicable for all new and existing products and services available for sale or renewal.

31 July 2024: Extension of the Duty to closed products or services.

Scope and Relevance

The Consumer Duty extends to all motor finance products and services offered to retail customers. It applies to firms that influence customer outcomes directly or indirectly, ensuring comprehensive compliance across the board.

Duty Requirements Overview

The FCA’s Finalised Guidance delineates the requirements of the Consumer Duty, aiming to foster beneficial outcomes for retail customers. Firms are expected to:

Expectations for Integration

The FCA expects motor finance providers to integrate the Consumer Duty deeply into their operational fabric. This includes:

Feedback on Implementation Plans

Recent reviews indicate that while many firms have embraced the new regulatory framework, others lag behind, posing a risk of non-compliance by the July 2023 deadline. The FCA highlights the necessity for:

Supervisory Approach and Future Plans

The Consumer Duty is a cornerstone of the FCA’s strategy through 2025, reflecting a commitment to higher standards of consumer protection. The FCA’s supervisory actions will focus on ensuring that firms not only comply with the Duty but also demonstrate a proactive approach to enhancing consumer outcomes. This includes continuous engagement with the industry through updates, events, and collaborations to support firms in meeting the Duty’s requirements.


The integration of the Consumer Duty within the Motor Finance Providers portfolio is critical for ensuring that consumer protection keeps pace with evolving market conditions, especially in light of economic pressures like the cost-of-living crisis. By prioritising this regulatory framework, motor finance providers will play a crucial role in promoting fair, transparent, and beneficial outcomes for all consumers.

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