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Providing the right support to clients with additional needs or vulnerability

When could a client be vulnerable?

Certain challenges may put clients in a position where they are at a risk of making decisions which may be financially harmful to them. It is important to identify signs of vulnerability and to provide the appropriate support that a client may need. A vulnerability may be short or long term and the impact can vary from person to person.

The Financial Conduct Authority identifies four drivers of vulnerability. These drivers, each with a list of examples that can indicate potential vulnerability, are:


Health

Which may include:

  • physical disability
  • severe or long-term illness
  • hearing or visual impairment
  • mental health condition or disability
  • addiction
  • low mental capacity or a cognitive disability.
Life events

Such as:

  • retirement
  • bereavement
  • an income shock
  • a relationship breakdown
  • the presence of domestic, financial, or economic abuse
  • caring responsibilities
  • other circumstances such as leaving care or moving house.
Resilience

For example:

  • erratic or inadequate income
  • living outside their means or over-indebtedness
  • having low savings
  • becoming overwhelmed emotionally.
Capability

Which could be:

  •  knowledge or confidence in managing finances
  • poor literacy or numeracy skills
  • poor English language skills
  • low digital literacy
  • learning difficulties
  • no or low access to help or support.

Firms and advisers have a responsibility to vulnerable clients to help them experience the same financial outcomes as other consumers.

Why do we need to consider clients with vulnerable needs?

We can provide a better service to clients if we are aware of their needs. Better service to clients also means a better service to you. For example:

  • We can save you time and resources by tailoring our client communications to suit your clients’ needs.
  • We can flag clients as vulnerable and record instructions, as well as monitor vulnerable clients as a safeguarding exercise.

Acting with due care and attention serves to improve consumer confidence.

Consumer duty regulation requires firms to acknowledge the needs of, and provide support to, vulnerable clients. Firms must be able to evidence that they are meeting and responding to the needs of vulnerable clients.

How can Transact help you?

We encourage you to let us know which of your clients are displaying characteristics associated with potential vulnerability by calling your Client Service Team.

We have comprehensive procedures in place to ensure staff can understand clients’ additional needs and respond to these appropriately. For example:

  • We can support electronic signatures if a client is unable to physically sign a Transact application form or supporting evidence.
  • We can print documents in larger font.
  • We capture details of client vulnerability, to enable our staff to meet client needs during any communication; this also means you and your client do not need to repeat the same information to us with each instruction.
  • We can monitor portfolios for particular activity where necessary.

For a list of external resources for clients, please click here.

This website is designed to be used by financial advisers, their clients and professionals. It is intended as general guidance only and should not be viewed as a recommendation to use or rely on any features mentioned. The information is not advice, nor is it a substitute for advice.
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"Transact" is operated by Integrated Financial Arrangements Ltd. 29 Clement's Lane, London EC4N 7AE. Tel: 020 7608 4900 Fax: 020 7608 5300. (Registered office: as above; Registered in England and Wales under number: 3727592). Authorised and regulated by the Financial Conduct Authority (entered on the Financial Services Register; no. 190856).