FCA report on consumer understanding: good practice and areas for improvement

April 23, 2026

The FCA has published examples of good and poor practice relating to the Consumer Duty’s consumer understanding outcome, set out in the FCA Handbook at PRIN 2A.5 . The guidance is relevant to all regulated firms, includes extra commentary for smaller firms, and has its focus on product design, manufacture, distribution and support, as well as production of communications and customer journeys. It supports the FCA's original Finalised Guidance for firms (Chapter 8 for consumer understanding) in relation to the Consumer Duty. Firms should use this guidance to review their oversight and testing of, and processes related to, the consumer understanding outcome.

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