FCA vulnerable customers.
I am not a law firm, and I am not a compliance monitor. If you need a legal opinion, instruct a lawyer. This page is my point of view on FCA vulnerable customers: the FCA definition of a vulnerable customer, the four drivers, the TEXAS model, the IDEA model, and what Consumer Duty vulnerable customers expectations look like in a real firm. The source I use is the FCA guidance for firms on the fair treatment of vulnerable customers, FG21/1.
The FCA definition of a vulnerable customer
The FCA definition of a vulnerable customer, in FG21/1, is someone who, due to their personal circumstances, is especially susceptible to harm, particularly when a firm is not acting with appropriate levels of care. Vulnerability is not a permanent label for a type of person. It can be temporary, sporadic, or long term, and it depends on the situation the customer is in when they meet your product.
FG21/1 groups the drivers into four. I use these four, and I do not add a private fifth.
- Health. A condition or illness that affects the ability to carry out day-to-day tasks.
- Life events. A change such as bereavement, job loss, a relationship breakdown, or becoming a carer.
- Resilience. A low ability to withstand a financial or emotional shock.
- Capability. Low knowledge of financial matters, low confidence managing money, or difficulty with literacy, language or digital skills.
A customer can sit in more than one of these at once. The useful question for a fintech, insurtech or femtech is which of the four your actual journeys assume away.
The TEXAS model
The TEXAS model, set out in FG21/1, is a plain way to handle the moment a customer tells you something difficult. I explain it as five habits.
- Thank the customer for telling you.
- Explain how their information will be used.
- eXplicit consent to record that information and to use it.
- Ask enough to understand the situation. Do not guess the rest.
- Signpost to support inside the firm, or outside it, when that is what they need.
The TEXAS model is not a script to read in a flat voice. If the only place it lives is a slide, it will not change what the customer hears.
The IDEA model
The IDEA model, also in FG21/1, is how I ask a team to understand the situation before they design a fix. Four questions, in this order.
- Impact. What is the situation doing to this customer, in practical terms.
- Duration. How long has it lasted, and how long might it last.
- Experience. Have they been through this before, and do they already have a way of coping.
- Assistance. What help do they need from you, as opposed to what your process usually offers.
Used together, the TEXAS model covers the conversation and the IDEA model covers the judgement underneath it. Neither one replaces product design.
Consumer Duty vulnerable customers
Consumer Duty vulnerable customers expectations sit on top of FG21/1, they do not replace it. The FCA Consumer Duty asks firms to deliver good outcomes, and to pay attention to customers with characteristics of vulnerability across those outcomes: products and services, price and value, consumer understanding, and consumer support. A policy that names vulnerability, but a journey that only works for a confident customer with time to spare, is not meeting that.
I am not here to monitor your compliance. I look at the customer evidence and say what I would change in the journey, the product, or the support. Your compliance team stays the owner of the regulatory interpretation.
How I run a vulnerability review
This is method, not a case study. I start from the FCA definition and the four drivers, then I pick a short list of journeys where a customer can lose money, lose cover, or get stuck. I use the TEXAS model where the work is a conversation, and the IDEA model where the work is understanding the situation before a design change. I look at the product rules, not only the helpline script. I check outcomes you can already see, or a small sample of real cases, and I write an action list with owners. I stop if the next step needs a lawyer.
The step-by-step version is how to run a vulnerable customer review under Consumer Duty. The wider FCA review, and what it means for proposition design, is in the FCA vulnerability review article. If you want a bounded start, the customer experience diagnostic is two weeks. How I help on the Duty itself is on the Consumer Duty page.
Common questions
What is the FCA definition of a vulnerable customer?
The FCA definition of a vulnerable customer, in FG21/1, is someone who, due to their personal circumstances, is especially susceptible to harm, particularly when a firm is not acting with appropriate levels of care. FG21/1 groups the drivers as health, life events, resilience and capability. I use that definition. I do not invent a private one.
What are the TEXAS model and the IDEA model?
The TEXAS model is a way to handle the conversation: thank the customer, explain how the information will be used, get explicit consent, ask enough to understand, and signpost to support. The IDEA model is how you understand the situation: impact, duration, experience and assistance. Both are set out in FG21/1. I use them as habits, not as a script to read aloud.
What do Consumer Duty vulnerable customers expectations mean in practice?
Consumer Duty vulnerable customers work is not a separate policy on a shelf. The outcomes still apply: products and services, price and value, consumer understanding, and consumer support. I look at whether someone in vulnerable circumstances can get through the journey, and whether you can show the outcome. I am not a law firm and I am not a compliance monitor.
Plain answers
Who does Megan Hunter work with?
I help scale-up fintechs, insurtechs and femtechs build customer propositions and operations that work in regulated financial services. I work with founders and customer or product leaders at remote-first fintech, insurtech, femtech and small agile regulated firms that hire remotely.
What does Megan Hunter do?
I help scale-up fintechs, insurtechs and femtechs build customer propositions and operations that work in regulated financial services. The work is proposition and go-to-market, customer operations, a customer experience diagnostic, and fractional or interim customer leadership. I am not a law firm and I am not a compliance monitor.
What proof is there?
I help scale-up fintechs, insurtechs and femtechs build customer propositions and operations that work in regulated financial services. I was previously Head of Customer Sustainability at Standard Life (FTSE 100). Delivered customer-vulnerability research and peer benchmarking for a UK bank, including journey mapping and frontline interviews that informed stronger external-referral options in serious circumstances. The site also records consulting remotely as a fractional leader on customer experience and product design for companies like a UK bank, a UK life insurer and pensions providers. Delivered a Salesforce-centred go-to-market assessment, mapping sales motions and data to adviser and institutional journeys, and recommending where to systematise, including where AI fits after the basics.
Get in touch
If you want a vulnerability review, tell me the product and the journey that worries you. I will say on the first call if a lawyer, or your own compliance team, should lead instead of me.