Picture a customer with three products – a mortgage, a savings account and an insurance policy.
Last month she told the call centre she’d lost her job and was struggling. An agent flagged her as potentially vulnerable. That flag lives in the CRM, meanwhile, the insurance platform has no idea – she just got sent a renewal with a cross-sell offer for extra cover.
Nobody did anything malicious, the systems just don’t talk to each other. But if the FCA asked you to show what happened to that customer, could you?
If you’re a smaller bank, building society, specialist lender or insurer, that question might cause a few frown lines to appear.
What the FCA actually said
In April, the FCA looked at the second round of Consumer Duty board reports. The headline was encouraging: firms are using a wider range of data and boards are more engaged. But it also said some firms presented plenty of data without really explaining what it showed about good, or poor, outcomes. Boards were told to go beyond MI dashboards and draw real conclusions. It also called out weak monitoring of outcomes across distribution chains, particularly where firms lean on intermediaries or outsourcing partners.
Then, on 27 July, it published its review of how firms monitor consumer outcomes. It found there were weak links between operational metrics – such as conversion rates – and actual customer outcomes, and limited evidence that firms check whether outcomes differ across customer groups – including customers in vulnerable circumstances. It also stressed that understanding outcomes is about more than collecting data or producing reports.
The good news for smaller firms
The FCA isn’t asking smaller firms to do what the big banks do – it expects firms of all sizes to take a proportionate approach, and says smaller firms can use a focused set of indicators as long as they can show how they spot and deal with customer harm.
That’s something small firms – who have relied on an informal approach – will have to keep in mind. Those that have leant on their experience of dealing with customers, rather than setting out what good and poor outcomes look like will need a more formalised approach.
So, whilst smaller firms get a lighter set of expectations, they still need proof. And proof is hard when your data sits in an admin system, a lending platform, a claims tool, a CRM… and a few brokers’ heads. Firms that have grown through acquisition are likely to have it harder. Duplicate records, three versions of the same customer, journeys that depend on which old brand someone joined through. So how do you get this straight?
Where firms usually start
The instinct is to fix the data. All of it. Buy a customer data platform, kick off a master data programme, and get a clean record for every customer across every system.
We understand the logic. But that’s a BIG job. Plus, it puts nearly all the cost up front and asks the board to wait a long time for anything to show. And, if you’ve already put money into a CRM or data programme that stalled (believe us – that’s more common than you’d think) you know how that conversation will go…
Focus on decisions, not data
The FCA is asking firms to define good and poor outcomes in practical terms and track them across the customer journey. It isn’t asking for a perfect record of every customer.
So, in our experience, most smaller firms don’t need a view of everything. They need a view they can trust for the decisions that impact customer outcomes.
Pick four or five things to focus on, for instance: renewal pricing, spotting vulnerable customers, cross-sell eligibility, complaints root cause or claims triage. Then map the data those decisions need.
If we were doing this work we’d run it in roughly three stages. This is our approach rather than a rule, so treat the timings as a guide.
- Weeks 1 to 4: Choose and map. Agree the decisions that matter most. Work out which systems hold the data behind them. Be ruthless about what stays out of scope. At this point you’ll usually find the duplicate records and the gaps, and that alone is useful.
- Weeks 5 to 8: Prove it on real data. Build a joined-up customer record for those decisions only, using live or representative data. Then look for a real result. How many duplicate records got resolved? How many customers hold products you couldn’t previously match? How many vulnerability flags surfaced that sat in a different system?
- After that: Decide with evidence. Now you’ve got numbers to take to the board. You can scale up what worked, drop what didn’t, and choose a platform that’s genuinely right for you.
So where does the tech come in?
A joined-up customer record (what a lot of people call a single customer view, or SCV, though banks will know the FSCS has its own use of that term) doesn’t have to mean ripping out your core systems. For a smaller firm, it can sit on top of what you’ve already got.
We build these on Creatio and Dynamics 365, and we’re not precious about which. Creatio is worth a look for smaller banks in particular. It’s a low-code platform, which keeps build time and cost down. And they’re putting serious money behind banking, having committed $300m to expand its Bank.ai platform.
The platform is the easy bit, though. The harder part is people. A joined-up record that brokers and frontline teams don’t use is just another expensive silo. Plan for adoption from day one. Ask the head of claims and the call centre manager what would make them open it every day, and keep that front of mind.
For most smaller banks and insurers, creating a single view of the customer is daunting even to picture, let alone deliver. Data is spread across lending platforms, admin systems, claims tools and CRMs, often with duplicates from past acquisitions. But it no longer has to be a multi-year programme. No-code, AI-native platforms let firms join up the data behind their most important customer decisions quickly and accurately, without ripping out what they already have. That gives boards the evidence the FCA is asking for under Consumer Duty, in weeks rather than years.
Daniel Lewis, Director of Partnerships and CRM, Salocin Group
What good looks like
Here are four things worth baselining before you start, then measuring again after the proving phase:
- Products per customer: How many customers hold products you couldn’t previously match across systems?
- Retention and renewal rate: Are renewals going out with a full understanding of what the customer holds?
- Operating cost per customer: How often do customers repeat themselves to the call centre, and what does that cost in handling time?
- Consumer Duty evidence: Can you show outcomes for different customer groups, including vulnerable customers, without a month of manual work?
Ask your teams how long it would take to pull together everything you hold on one customer across all systems. If the answer is days, you’ve found your starting point.
Finally
Let’s go back to our customer with the mortgage, the savings account and the insurance policy. You don’t need to start from scratch to make sure the agent who flagged her as struggling, and the system that sent her the upsell message are looking at the same record.
We know smaller firms can feel like they’re playing a harder game than the big banks – having to deal with the same regulations but with a fraction of the budget. The reality is though, the FCA has said it will accept a proportionate approach, as long as you can show how you spot and deal with customer harm.
So pick the few decisions that matter most, join up the data behind them, and prove it works before you commit to anything big.
If you’d like a hand working out where to start, contact us for an informal chat.
