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The Central Bank of Ireland (CBI) has launched a three-phase review of the Consumer Protection Code. The timeline for this review is as follows:
Phase 1: publication of the Code discussion paper, where the CBI invites responses from a number of stakeholder groups until March 2023. Feedback on the discussion paper will be provided in Q2 2023.
Phase 2: a public consultation paper on the Code will be published in Q4 2023.
Phase 3: during the course of 2024, the Code will be revised and supporting regulations will be published, along with a feedback statement clarifying the CBI’s approach to the updated Code.
Speaking at the launch event, Governor of the CBI, Gabriel Makhlouf, said: “The Consumer Protection Code is a cornerstone of consumer protection in financial services in Ireland. The Code has served consumers well. It has established a set of rules and expectations for how firms should treat their customers and has allowed us to intervene to protect consumers. We are now undertaking this review to ensure that the Code remains fit for purpose and future-ready, and that consumers remain well-protected.”
The CBI sets out two broad discussion themes focusing on:
Availability and choice; and
Firms acting in consumers’ best interests.
These themes consider the conditions needed to support consumers’ best interests, including the role of effectively functioning markets in providing appropriate levels of availability and choice. To help drive better outcomes for consumers, the CBI considers the impact of changes in financial services on consumers and how firms can better protect their customers’ best interests, supported by proposed guidance.
The discussion paper then sets out eight further, more focused discussion themes that seek to explore important topical issues for consumers. The themes, informed by global standards such as the OECD's High Level Principles on Consumer Financial Protection, include:
Innovation and disruption: to ensure that benefits of change and innovation are realised for consumers and the economy with the appropriate risk mitigation measures in place.
Digitalisation: to maximise the benefits of increasing digitalisation while ensuring that consumers are protected from unfair practices and the appropriate use of personal data.
Unregulated activities: consumers have clarity around activities that are regulated and those that are unregulated.
Pricing matters: consumers have access to clear and unbiased information on pricing.
Informing effectively: consumers receive sufficient information at the right time to enable informed decisions as to financial products and services.
Vulnerability of consumers: firms understand vulnerability and take steps to address the needs of vulnerable consumers.
Financial literacy: in recognition of financial literacy’s role in ensuring that consumers’ best interests are protected, the CBI is seeking views on what can be done to improve financial education.
Climate matters: firms act in customers’ best interests as financial products and services evolve to respond to climate change.
The feedback received on the discussion paper will inform the CBI’s decision-making on the proposed revisions to the Code. Equally, it is a chance for firms to outline any difficulties with the proposals.
Additional points raised in the discussion paper include:
the government’s ongoing retail banking review;
a potential review of the switching code to address any gaps emerging from the current migration of bank accounts;
the CBI’s enhancements to its pre-application engagement with firms considering authorisation as a regulated entity; and
a planned consultation in 2023 on proposed enhancements to the Innovation Hub.
PwC has extensive experience in helping firms ensure compliance with the Consumer Protection Code and its guidance.
With our pool of experienced risk and regulatory specialists, and as a market leader in financial services advisory, PwC is uniquely positioned to provide insight into regulatory expectations due to our regular engagements with the CBI.
We can assist firms impacted by the review of the Consumer Protection Code by sharing industry views, facilitating discussions between impacted firms and collating a response to the current discussion paper.
We can also advise firms on:
the adequacy of existing consumer protection frameworks, policies and procedures;
consumer protection training, tailored by industry sector;
reviews of the consumer life cycle and roles and responsibilities across the three lines of defense;
digital tools to drive efficiencies and compliance in the consumer life cycle; and
sustainable financial products to ensure that they are defined in an accurate and transparent manner.
Director, PwC Ireland (Republic of)
Director, PwC Ireland (Republic of)
Partner, PwC Ireland (Republic of)