A new Financial Guidance and Claims Bill was just one of the announcements in the recent (21 June) Queen’s Speech.
The Bill will create a new financial advice body to provide debt advice, money guidance and pension guidance from one place. This means existing services for these areas of advice will be combined, so consumers can find them in one place. Currently, there’s no date for when this financial advice body should be in place.
It will also mean that the Financial Conduct Authority (FCA) regulates claims management companies, and the Financial Ombudsman Service (FOS) will now handle complaints.
We’ll take you through what this means for our industry and for consumers.
A new financial advice body
The Government first announced that it would scrap the Money Advice Service (MAS) in March 2016. At this time, it also said the Pensions Advisory Service (TPAS) and Pension Wise needed restructuring.
With the new financial advice body, customers should receive a more consistent service when they’re seeking help or advice on debt, money or pensions. Hopefully, it will also mean better value for money as there won’t be three services to cover similar areas.
It also means they’ll be able to access all three of these services from one place. This will make the new financial advice body a centralised ‘hub’ for all advice related to money.
The single financial advice body will be funded by existing levies on the financial services industry, and on pension providers.
Claims management regulation
The Financial Guidance and Claims Bill will also mean that the FCA will regulate claims management companies. This includes companies who manage PPI claims, care home charges and bank charges.
Currently, the Government says that 76% of the public don’t believe that claims management companies tell the truth to their customers. This could be due to a number of claims management companies not providing a good service to consumers.
This will also allow the FCA to cap claims management companies’ fees to customers. This should mean a fairer service for consumers. It should also ensure a more robust authorisation process for new firms looking to enter the market.
Will the Financial Guidance and Claims Bill help?
We welcome all additional governance within the financial services market. We also think that the Financial Guidance and Claims Bill will mean more effective signposting and outcomes for customers and will ensure that they receive a better service.
The new single financial advice body will mean a more consistent experience for customers looking for debt and pensions advice, and guidance on money in general. It’s important that all customers get the help they need to tackle any financial issues they might be having, and that they’re supported to avoid and resolve debt related issues.