Despite confidence in market growth, advisers say more needs to be done to meet regulatory obligations
A significant number of financial advisers are uncertain about whether they fully meet Consumer Duty requirements when advising on later life lending, according to new research from Key Later Life Finance.
The study, which surveyed professionals including over-50s specialists, wealth managers and general advisers, found that only 45% felt “very confident” in their current approach to Consumer Duty within the sector. Another 41% said they were “quite confident” but recognised areas for improvement, while 16% admitted low confidence and acknowledged a need to raise standards.
Despite strong belief in the sector’s growth potential, nearly three-quarters (74%) of those surveyed said they are concerned about aligning with regulatory expectations and Consumer Duty responsibilities.
The Financial Conduct Authority (FCA) introduced new rules and guidance under the Consumer Duty framework, which imposes higher and clearer standards of consumer protection across financial services. It requires firms to prioritise customer needs and deliver fair outcomes at every stage of the product and service lifecycle.
Key Later Life Finance, an equity release advice provider, said the shift in regulatory expectations means advisers must provide the full range of later life lending solutions to older clients in order to meet those obligations. The company has also proposed that recording all client meetings should become standard practice — suggesting it be adopted into the Equity Release Council’s industry standards.
In response to these expectations, 32% of advisers reported introducing mandatory call recording as part of their quality assurance efforts. Additionally, 36% said they now provide more in-depth explanations about compound interest, and 37% are more thorough in discussing the value of making repayments.
“Clients should be advised of all their options under Consumer Duty if good customer outcomes are to be achieved,” said Will Hale (pictured), chief executive of Key Later Life Finance. “Advisers who are concerned about meeting Consumer Duty obligations should be aware that there is support available to enable them to be fully compliant.
“Regulators have set out what is needed from advisers operating in the market and Consumer Duty obligations have emphasised the need to deliver good customer outcomes through ensuring that clients are informed of all their options.
“Comprehensive conversations around what a customer may afford to repay to optimise cost of borrowing and or how health and lifestyle factors may positively influence the rate or LTV available are crucial if consistently good outcomes are to be achieved.”
Hale also reiterated the role of technology in supporting compliance, stating that call recording offers a simple way to evidence advice and ensure transparency. “Recording all meetings opens up other exciting opportunities to use AI to drive efficiency and productivity benefits and to improve customer experience,” he said.
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