The Financial Conduct Authority (FCA) has highlighted that lenders could enhance their treatment of bereaved customers.
The City regulator released a framework detailing examples of good and poor practices, aiming to assist firms in offering appropriate support to consumers during challenging times, as reported by .
According to the FCA, the introduction of the Consumer Duty in July 2023 has improved policy and procedural clarity, yet it noted that staff are often "unclear on the actions they need to take and how quickly."
Emad Aladhal, the FCA's director of retail banking, commented: "Dealing with a bereavement or setting up a power of attorney can often be stressful and emotional."
He added, "When banks and building societies get it right for their customers they can make a real difference at a difficult time."
However, he also pointed out, "But when they fail to recognise and respond to customers who need more help, it adds to the stress. All firms should consider where they can make improvements."
The regulator reported instances where individuals and their representatives struggled to access funds for essential bills due to lenders' unclear bereavement procedures. This follows a critical multi-firm review conducted by the regulator in November 2024, which scrutinised life insurers' processes for handling bereavement claims.
The review found that "Most firms were unable to meet some of their own bereavement claims process service performance levels within the period we looked at."
The Financial Conduct Authority (FCA) noted that claimants were "experiencing delays resulting in poor outcomes and customer harm."
Following the government's drive for economic growth, the FCA rolled out a five-year plan aimed at assisting consumers in better navigating their financial choices. This strategy will shine a light on banks' obligations under Consumer Duty.
Aladhal advised: "Our message to consumers is this – if you need to notify your banking provider about a bereavement or a power of attorney, speak to them about how they can support you and meet your needs."
