More advisers yet to adopt Consumer Duty Compliance tools, research finds

By Divya Shah

More than four in ten UK financial advisers are unaware of digital tools that can help evidence Consumer Duty compliance, according to new research from digital portal provider Dorsum in partnership with consultancy The Lang Cat.

The study, which surveyed 109 advice businesses, found that 56% of advisers currently use technology to help demonstrate and comply with the Financial Conduct Authority’s (FCA) Consumer Duty requirements. However, 42% said they were unaware of digital solutions that can automatically support compliance evidence gathering.

The findings come as the FCA continues its supervisory work around Consumer Duty, with several firms already facing investigations related to the regime.

Despite limited awareness, advisers generally hold a positive view of compliance technology. Nearly six-in-ten respondents, about 58%, agreed that technology can reliably support Consumer Duty compliance, while 10% disagreed. Around 32% remained neutral on the issue.

The research also highlighted a strong preference for combining technology with human expertise rather than replacing compliance professionals altogether. Almost three-quarters nearly 73% of advisers said they would rather use technology alongside a compliance specialist.

Dorsum’s findings highlight concerns raised in a recent report by the Chartered Insurance Institute (CII), which found that financial planning and insurance firms continue to face challenges in evidencing positive customer outcomes under Consumer Duty.

Hannah Buckle, Head of UK Sales at Dorsum, said, “Consumer Duty has increased the burden on advisers to demonstrate outcomes such as value for money and consumer understanding.”

According to the CII, around three-quarters of surveyed firms reported difficulties with key data-related processes, including integrating data, sourcing appropriate information, and connecting datasets across systems.

“Consumer Duty has placed a greater burden onto financial advisers to prove and evidence things like value for money and consumer understanding. Most firms see it as a compliance challenge, when really, it’s a technology challenge,” Buckle added.

“We know advisers are stretched for time. Technology firms should be helping advisers to remain compliant by generating a timestamped, system-generated audit trail. The FCA is not going to prescribe exactly how firms evidence their obligations, but firms with clear, organised and consistent data will have significantly easier conversations with the regulator than those without,” Buckle further added.

The research suggests that while awareness of compliance-focused technology remains relatively low across the advice sector, demand for digital tools that can streamline audit trails and regulatory reporting is growing as firms adapt to the FCA’s Consumer Duty requirements.