Just 56% of advisers are using technology to help them evidence, and comply with, Consumer Duty, new research for digital portal provider Dorsum shows.
The findings come as the FCA continues its supervision exercise into Consumer Duty, which has already resulted in several investigations into firms.
The research, which polled 109 advice businesses on their attitudes towards technology and compliance, found 42% of advisers were not aware of digital tools that can help automatically evidence Consumer Duty compliance.
However, attitudes toward compliance technology were cautiously positive: 58% of advisers agreed that technology can reliably support Consumer Duty compliance. Just one-in-ten (10%) disagreed out right.
Overall, advisers want to use technology alongside human expertise, with three-quarters (73%) saying they would prefer to use it alongside a compliance professional, rather than as a replacement.
Dorsum’s research follows publication of a recent Chartered Insurance Institute (CII) report, which found financial planning and insurance firms continue to face practical challenges in proving that good consumer outcomes are being delivered.
The CII found around three-quarters of surveyed firms highlighted difficulties relating to integrating data, sourcing appropriate data and connecting datasets.
Hannah Buckle, head of UK sales at Dorsum, said: “Consumer Duty has placed a greater burden onto financial advisers to prove and evidence things like value for money and consumer understanding. Most firms see it as a compliance challenge, when really, it’s a technology challenge.
“We know advisers are stretched for time. Technology firms should be helping advisers to remain compliant by generating a timestamped, system-generated audit trail. The FCA is not going to prescribe exactly how firms evidence their obligations, but firms with clear, organised and consistent data will have significantly easier conversations with the regulator than those without.”
