Looking after customers and delivering great service is a priority for every responsible dealer. That’s why it’s important to take note of the latest findings from the Financial Conduct Authority (FCA).
Published in March, the report highlights how firms are supporting customers in vulnerable circumstances, showcasing examples of good practice and identifying where there’s room to improve.
Understanding vulnerable customers
The FCA defines a vulnerable customer as someone who, due to personal circumstances, is especially susceptible to harm, particularly when a firm is not acting with appropriate levels of care. Vulnerability can arise from various factors, including:
- Health issues: Physical or mental health conditions that affect decision-making.
- Life events: Such as bereavement, redundancy, or relationship breakdowns.
- Financial difficulties: Limited income or debt problems.
- Capability issues: Low literacy or numeracy skills, or limited digital literacy.
Recognising these factors is crucial in providing tailored support to your customers.
FCA guidance
The FCA's guidance for businesses emphasises the importance of understanding and addressing the needs of vulnerable customers. Key recommendations include:
- Staff training: Ensure all staff are trained to recognise signs of vulnerability and are equipped to handle such situations with empathy and professionalism.
- Clear communication: Use simple, jargon-free language in all customer interactions. Offer information in various formats to cater to different needs, such as large print or audio.
- Flexible processes: Adapt your sales and finance processes to accommodate customers who may need extra time or support. For dealerships, this could involve extended test drives or providing additional explanations of finance terms.
- Feedback mechanisms: Implement systems to gather feedback from customers, particularly those who may have felt vulnerable during their experience. Use this feedback to improve your services.
- Collaboration with support services: Establish connections with local support organisations that can assist customers facing specific challenges, such as debt advice services or mental health support.
Practical steps for dealerships
- Create a welcoming environment: Ensure your dealership is accessible to all customers, including those with mobility issues. Display clear signage and provide seating areas for those who may need to rest.
- Offer personalised assistance: Assign a dedicated staff member to assist customers who may require additional support, ensuring they feel valued and understood.
- Review sales practices: Regularly assess your sales techniques to ensure they are not pressuring customers into decisions they may not fully understand or afford.
- Promote financial literacy: Provide resources that help customers understand the financial aspects of purchasing a vehicle, including explaining credit terms and loan options.
By implementing these practices, your dealership can not only comply with FCA guidelines but also build trust and loyalty among all customers, particularly those in vulnerable circumstances.
For more detailed guidance, refer to the FCA's full report on treating vulnerable customers fairly: FCA Guidance. For further support, you could also take a look at the Money Advice Trust’s vulnerability resources.
Insights from MotoNovo
We have a whole host of motoring insights for you, take a look here now.
MotoNovo is committed to supporting dealers. If you need any further information or assistance, please feel free to reach out to your MotoNovo contact.
Remember, supporting those with vulnerabilities is not just about compliance; it's about doing the right thing and fostering a reputation for care and integrity with your customers.
