"The question we do want to consider in the market study is whether the tools available to consumers to help them make decisions effectively meet their needs."
It will also look into the relationships between brokers, lenders, panels and price comparison websites as part of its investigation into the role of consumer decision-making in ensuring good market dynamics in the mortgage sector.
Speaking at The Mortgages Conference in London, Christopher Woolard, executive director of strategy and competition at the FCA, said respondents to a previous call for input made clear that consumers face challenges in making effective choices, particularly when it comes to assessing and acting on information about mortgage products.
Woolard said: "The question we do want to consider in the market study is whether the tools available to consumers to help them make decisions effectively meet their needs.
"There are of course already many tools to help consumers shop around – brokers, price comparison websites, apps, etcetera. These should assist consumers in searching for the most suitable product for their needs, but we want to consider whether there may be any distortions caused by an undue focus on certain headline charges or features."
He confirmed that the FCA will be working with the Competition and Markets Authority who made public last week that they will initiate a market study looking specifically at price comparison websites and apps.
It will also look into what extent these tools serve consumers with less common needs. Lloyds Bank recently estimated that around 11 million people in the UK have low digital capability and may not have access to the same choice as people who can readily use price comparison websites.
Woolard said that "more broadly, we intend to use the study as a means of reviewing the impact of the MMR as a whole", adding that the intermediary lens "is a crucial one" as the role of intermediation has increased significantly since MMR.
He added: "Intermediated mortgages sales, which had decreased to around 50% in 2009/10, had increased to 67% of the number of sales in Q2 2016. To what extent is this increase caused by the MMR’s rules on advice? It’s not wholly clear to us, and that’s one of the questions we are considering."
