LVM – TREATING CUSTOMERS FAIRLY POLICY
Leaseline Vehicle Management Ltd (LVM) is fully committed to providing customers
with an excellent level of service and treating customers fairly this has been at the
core of our business philosophy for many years.
The Financial Conduct Authority set out principles and outcomes based on “Treating
Customers Fairly” and “Consumer Duty”. These approaches are detailed below.
Treating Customers Fairly (TCF)
Treating Customers Fairly (TCF) is one of the cornerstone principles laid down by
the Financial Conduct Authority. This guiding principle is sub-divided into six key
elements which dictate the way in which we deal with our customers in terms of
communication, expectations, level of service and the products and services we
offer.
The six guiding principle elements are;
• Consumers are confident that they are dealing with firms where the fair
treatment of customers is central to the corporate culture.
• Products and services marketed and sold in the retail marketplace are
designed to meet the needs of identified consumer groups and are targeted
accordingly.
• Consumers are provided with clear information and are kept appropriately
informed before, during and after the point of sale.
• Where consumers receive advice, the advice is suitable and takes account of
their needs and circumstances.
• Consumers are provided with products that perform as firms have led them to
expect, and the associated service is of an acceptable standard and as they
have been led to expect.
• Consumers do not face unreasonable post-sale barriers imposed by firms to
change products, switch providers, submit claims or make a complaint.
In practical terms we adhere to the above principle by;
• Listening to our customers to understand their needs.
• Offering only market products which are appropriately targeted, clear, and
unambiguous, highlight the risks and conditions as well as the key features
and benefits.
• Ensuring customers understand any risks associated with products and
services.
• Ensuring services are delivered to customers openly, with clarity and
transparency and do not contain hidden conditions or complex definitions.
• When, in the event of providing advice, that the advice given takes into
account the customers’ needs and circumstances.
Taking the customers’ privacy seriously and ensuring that members of staff
are trained to follow the rules in relation to data protection and to keep
customers’ details secure and confidential.
• Taking complaints seriously and dealing with them promptly, learning from
them and modifying operations and processes where necessary
Consumer Duty
Consumer Duty is a new protection for customers aimed at those using finance to
purchase goods and services. This legislation is part of the FCA’s consumer
principles and will be the 12th principle. This area states that companies must “act to
deliver good outcomes for retail customers”. In short, businesses have a
responsibility to help customers make the best decisions on finance based on their
needs.
The new legislation applies to all companies regulated by the FCA. So, it’s not just
car leasing companies – insurance brokers and banks come under the remit.
However, Consumer Duty only applies when taking out a finance agreement. So,
products such as Hire Purchase (HP) and Personal Contract Purchase (PCP) are
examples of where the principle applies.
What are the rules of Consumer Duty?
As the FCA wants every customer to experience a good outcome when taking out a
finance agreement, there are some rules businesses must follow. These include:
• Act in good faith towards customers
• Avoid causing foreseeable harm to customers
• Allow and support customers to pursue their financial objectives
These three rules cover all FCA-regulated companies, so some may apply more
than others to specific businesses.
For example, the first two rules can be attributed firmly to car finance companies.
However, the third rule is more likely to fit better with financial and investment
organisations.
However, the overarching rules apply to all, so each is required to be integrated into
new processes from August 2023.
What are the outcomes of Consumer Duty?
Alongside the main rules of this principle, Consumer Duty sets out four outcomes to
ensure customers receive the best and most appropriate service for their needs. The
basic overview of these outcomes includes:
Products and services
The lifecycle of a product or service should have full governance and evidence that
the product has been designed and marketed correctly and targeted at the
appropriate people.
Price and value
Every aspect of pricing should be understandable and transparent. Customers
should also receive fair value, particularly in relation to additional charges and fees.
Consumer understanding
Businesses must ensure customers have the right information to make informed
decisions before purchasing a product or service. Risks and features must be
communicated clearly. Plus, organisations are required to understand specific
customer needs. For example, establishing the best communication methods.
Consumer support
For customers to experience a good outcome, they must be able to use the financial
product appropriately, and companies should support this. Processes may need
adapting if customers don’t receive good outcomes.
LVM is committed in providing products that adhere to the code of the Consumer
Duty namely;
Principle 12: Consumer Duty
• Pro-actively seek to deliver good outcomes for consumers.
• Put consumers’ interests at the heart of their activities.
• Focus on the outcomes consumers get and act to pursue their financial objectives.
• Ensure we have sufficient understanding of customer behaviour and how products
and services function.
• Put in place processes to tackle factors that are leading to poor outcomes.
• Consistently challenge themselves to ensure their actions are compatible with
consumers’ interests and financial objectives.
Please visit our complaints procedure page.