Insight and events

Liza Campion, Head of Corporate Accounts, Kent Reliance for Intermediaries

Imagine you’re approached by a customer who’s looking for a residential mortgage. During your conversation, you find out that they’re partially sighted and have a little trouble reading the text on documents. Or you may discover they’ve recently separated from their long-term partner. You may even notice that they sound a little down or agitated.

If I were to ask you in which of these situations you thought the customer may be vulnerable and at risk of potential harm, which one would you pick out as being worthy of a little extra attention?

You may be surprised to learn that there should be a red flag waving in each of the situations I’ve described. In all of the above scenarios, there are indications that the customer could be considered as being vulnerable.

I know it can sometimes be difficult to pin down exactly what constitutes a vulnerable customer, so I thought it would be useful to take a closer look at who’s at risk, some of the warning signs to look out for and why it’s so important you tell us as early as possible about a customer’s vulnerabilities so we can make sure they receive the additional support they need.

How to identify a vulnerable customer

Vulnerable customers are from all backgrounds, in every society and every walk of life; but they may not always be who you think they are.

In simple terms, a vulnerable person is someone who, due to their personal circumstances, could be susceptible to harm - particularly when financial institutions are not acting with appropriate levels of care.

The FCA guidance for firms on the fair treatment of vulnerable customers says: ‘All customers are at risk of becoming vulnerable, but this risk is increased by having characteristics of vulnerability. These could be poor health, such as cognitive impairment; life events, such as new caring responsibilities; low resilience to cope with financial or emotional shocks; and low capability, such as poor literacy or numeracy skills’.

The FCA’s guidance goes on to say that vulnerability should be thought of as a spectrum of risk and this risk is increased by characteristics related to four key drivers:

• Health – health conditions or illnesses that affect the ability to carry out day-to-day tasks, such as physical disability, severe or long-term illness, hearing or visual impairment, mental health conditions, addiction and a low mental or cognitive ability.
• Life events – life events such as bereavement, job loss or relationship break down. This can include things such as retirement, income shock, relationship breakdown, domestic abuse and caring responsibilities.
• Resilience – low ability to withstand financial or emotional shocks, such as inadequate or erratic income, over-indebtedness, low savings and low emotional resilience.
• Capability – low knowledge of financial matters, low confidence in managing money (financial capability) or low capability in other relevant areas, such as literacy or digital skills.

How Kent Reliance for Intermediaries can help with your vulnerable customers

As an FCA regulated lender, ensuring customers have an appropriate degree of protection is central to what we do. We want vulnerable customers to experience outcomes as good as those received by other customers and receive consistently fair treatment. We want to create a culture of openness and transparency, and we also want you to have full confidence in disclosing a customer’s vulnerability.

As we’ll have a relationship with them for the lifetime of their mortgage, it’s vital that we understand our customers. We can only do this with your support. Unlike some other lenders, we’re a 100% intermediary-focused business. Whilst this means you’ll receive our undivided attention when you place a case with us, it does mean you play a crucial role in alerting us if you have a vulnerable customer or suspect they may have vulnerabilities.

The most important thing to remember is not to be afraid in letting us know. Just because they have a vulnerability doesn’t mean that we’ll automatically turn them down for a product. Be inquisitive about a customer’s circumstances. Talk to them and really get to know them. What are the things that are making them vulnerable? Is it a temporary situation or a longer-term issue? What can be done to give them the reassurance they need?

It may be that they have mobility issues which prevent them from getting to the phone quickly and would like it to ring out a little longer when we call. It may be that they’re on medication and would prefer we contacted them in the afternoon rather than in the morning. Or they may struggle to understand a product and need someone to explain it to them in a clear, concise way.

Whatever their additional support needs, our defined and robust approach ensures they’ll be treated fairly. Our upskilled staff receive the ongoing training they need to recognise and respond flexibly to their needs, whilst our systems and processes are set up to deliver help in a way that empowers and supports them.

With an estimated four in 10 people in the UK defined as being vulnerable, it means there’s a lot of customers who may be in need of some extra support.

The most important thing you can do is to let us know as soon as possible so we can put the necessary measures in place to deliver a satisfactory outcome for everyone involved - your customer, you and us.

To find out more, take a look at our Consumer Duty Hub which outlines the roles and responsibilities expected of us. You’ll also find details about what we’re doing as a business to meet them and provide good outcomes for your customers, as well as copies of our fair value assessments.

Get in touch with us or speak to your BDM to find out how we can help. This article forms part of a series around the four pillars of vulnerability, others articles cover resilience, health, capability and life event.