Event recap - How can banks better use data to support customers in vulnerable situations?

We recently hosted a webinar exploring how banks can use data to support customers in vulnerable situations. 

This event, sponsored by HSBC UK following their Mental Health Accessible accreditation, brought together experts from across the vulnerability, regulatory and financial services sectors to discuss the opportunities, challenges and exciting developments taking place across the banking sector.

Chaired by our Head of Strategic Partnerships, Rosie Normanton, we were pleased to have Malintha Fernando MBE from HSBC, Money Advice Trust’s Chris Fitch, Katherine Townsend from Nationwide, Tom Doidge from Capital One and Jo Legg from the FCA join the panel and share their insights and knowledge. 

We were also delighted to share a pre-recorded interview with Jo, an expert by experience from our Research Community. Jo discussed her experiences of engaging with her bank, as well as her thoughts on how banks could and should support people with mental health problems.

As those working in financial services know well, the Consumer Duty has brought the protection of consumers in vulnerable situations to the fore. The Duty requires banks to establish the nature and scale of vulnerability among their customer base and target market, and the potential foreseeable harms that need to be prevented. As the Duty is being implemented, it feels enormously timely to discuss the powerful potential of data has to help firms meet these requirements. We also wanted to explore the opportunities to use consumer data to identify, engage and support people who might be facing challenging circumstances.  

An opening contribution from our panellists highlighted that while data can feel like an abstract concept, the information firms hold about us has to come from somewhere. It could be that a national dataset tells a firm about customer demographics, but a lot of the information about vulnerability and mental health potentially comes from the customers themselves. From the things we tell our bank and building society, from the ways we interact, to how we operate our products and services.

To highlight the opportunities and drawing on our research, our Interim Chief Executive Conor D’Arcy kicked off the discussion by sharing that half of people (51%) agree that the benefits of their bank or building society looking through their financial data to try and spot problems outweigh the risks.

Telling your bank or building society that you have a mental health problem is often thought as the first step to accessing extra support. However, living with a mental health problem can make it extremely difficult to share your experiences with others. The panellists also helpfully highlighted that many people may not be aware that they have a mental health problem, while those who have been diagnosed may not want to disclose this information, or may not realise it would make any difference. 

As our previous work on disclosure uncovers, the inability to share this information may be rooted in worries about judgement, fears of financial consequences, or lack of adequate opportunities to disclose. There can also be fears that sharing this information will not change anything. 

It was highlighted by panelists that transparency about what types of data will be gathered and for what purposes are important in encouraging people to share their experiences. A level of kindness and empathy from staff is important when dealing with people in vulnerable circumstances. Our speakers also discussed that choice and control over how this data is stored, how long it is stored for, whether it can be removed and who it will be shared with is vital for allowing people to feel in control.

In the midst of a very technical discussion, our panellists (and our Research Community member Jo) were keen to highlight that at the centre of all of this must be the lived experience of people in vulnerable circumstances. The first-hand experience of people with mental health problems, and other vulnerabilities, should be the leading light in understanding how data can be used to better identify, engage with and support people. And the vulnerabilities people may experience are diverse. Listening to the thoughts, ideas and experiences of different groups of people will allow all essential services firms to better understand and support their customers.

The event moved onto a rich discussion regarding the use of aggregate data and individual data. The Consumer Duty compels financial services to ensure good financial outcomes for their customers and the collection and proactive use of data can enable firms to achieve this. 

Our panellists argued that firms need to acknowledge and cater to the diverse needs of their customer base, and be proactive in identifying risk and acting to avoid foreseeable harm. While aggregate data is vital in building tools designed to understand and gauge vulnerability across a firm’s consumer base, innovative use of individual data could transform how consumers are supported once identified as facing a vulnerable situation. 

The opportunities that data presents in improving outcomes for people in vulnerable circumstances are manifold. However, there are still many important conversations to be had. Reflecting on the challenge ahead, panellists discussed how banks have been using data for a long time. But using it to shape products and services for customers in vulnerable circumstances is a relatively new phenomenon, driven by the FCA’s guidance of the fair treatment of vulnerable customers and the more recent Consumer Duty. It is important to recognise we are in the early stages of this process, so it is critical to regularly reflect on what we have done well and what is learned when we get it wrong. Input from people with lived experience will be vital in enabling banks and building societies to achieve the best financial outcomes for their customers, as expected by the Consumer Duty. 

We look forward to further opportunities to listen, learn and collaborate on these opportunities and are always looking to learn from people working or engaged in this space. Sign up to our Professional Network to keep updated with our work and future events.

Or if you are from a bank, building society or essential services firm and would like to learn more about our Mental Health Accessible accreditation, please get in touch with [email protected]