FCA Consumer Duty and digital products: Is your financial services app compliant in 2026?

The FCA has shifted from reviewing digital product compliance to actively investigating six firms for potential breaches of the Consumer Duty as of March 2026. Year 2 board reports reviewed in April 2026 indicated sector-wide progress, but the FCA noted that the quality and depth of analysis remain inconsistent. For financial services firms with digital products developed before Consumer Duty, this inconsistency is insufficient.

From review to enforcement: what changed in 2026

Consumer Duty has been in effect since July 2023. During the first two years, the FCA focused on supervision by issuing guidance, reviewing board reports, and highlighting areas for improvement. This supervisory phase has now ended.

In March 2026, the FCA confirmed it was conducting active investigations into six potential Consumer Duty breaches, primarily concerning fair value. Its April 2026 review of Year 2 board reports found improved governance but inconsistent quality and depth in outcomes analysis. The FCA stated clearly that firms must link data to consumer outcomes with evidence, not assumptions.

For firms with digital products, the requirement is clear. If a digital journey cannot demonstrate positive consumer outcomes through data, this is a product issue, not a compliance gap. In 2026, product issues have regulatory consequences.

Why most financial services’ digital products have a Consumer Duty problem

The FCA’s March 2026 review of consumer understanding surveyed 38 firms across insurance, retail banking, payments, and consumer finance. It found limited communication testing, inaccessible or overly complex product information, and a widespread failure to use data to assess whether customers understood their purchases.

These issues are longstanding and stem from how most financial services’ digital products were originally built. Consumer Duty became law in July 2023, but most digital products were designed before then, without considering Consumer Duty outcomes.

The four Consumer Duty outcomes, consumer understanding, consumer support, products and services, and fair value, are product requirements, not compliance checkboxes. Products not designed with these outcomes in mind cannot achieve compliance through policy reviews or legal sign-off alone. The product itself must be evaluated.

Deloitte’s 2025 UK research found that most business leaders believe 21 to 50 per cent of their technology investment remains untapped. In financial services, much of this gap stems from the mismatch between what digital products were originally built to do and current regulatory requirements.

Three questions your digital product needs to answer

Before assessing Consumer Duty exposure across digital products, firms must answer three key product questions, not legal ones. Are our customers understanding what they are buying?

The question is not whether information is technically present, but whether customers actually understand it when needed. The FCA’s March 2026 review found that many firms relied on sales data or a lack of complaints as evidence of understanding. The FCA made clear that this is insufficient. Consumer understanding requires active testing, not assumptions.

Product data provides key signals. Completion rates, support escalations, and complaint themes indicate how well a product is performing. When the journey works, these signals are minimal.

Does the product support customers when it matters most?

Consumer support is as much a product design issue as an operational one. The FCA’s July 2025 review found digital journeys often directed customers to higher-friction channels at critical moments. Examples include claims notifications that hide contact numbers, renewal journeys that obscure switching options, and onboarding flows that require unnecessary phone calls.

These are design decisions that require design solutions. Addressing them means evaluating the product itself, not just compliance documentation.

Can you demonstrate fair value through the product experience?

Fair value under Consumer Duty goes beyond pricing. It considers whether the digital experience aligns with the value customers expect. Products with fair pricing but confusing renewal journeys, difficult claims processes, or unclear cancellation flows have fair value issues. With six active FCA investigations focused on fair value, this is now a concrete concern.

What good practice looks like now

Firms identified by the FCA as demonstrating good practice treat Consumer Duty outcomes as ongoing product requirements. They integrate outcome monitoring, test journeys with real user behaviour, and use data to drive continuous improvement.

This approach requires viewing product data as actionable signals rather than mere reporting obligations. Most financial services digital products generate substantial outcome data. The FCA emphasised in its July 2025 review that firms struggle when they collect data but do not act on it.

Sonin has developed and reviewed digital products in FCA-regulated environments for over fifteen years. Our experience includes motor and home insurance platforms with Sheilas’ Wheels and esure, telematics-based products with Marmalade Insurance, and specialist financial platforms with Paratus. In every case, we began by understanding the product’s actual outcomes for users, not just its intended purpose.

A product discovery and audit process maps digital journeys against Consumer Duty outcomes. It identifies actual product performance, highlights gaps, and provides evidence before any decisions about changes are made.

Start with the audit

For financial services firms with digital products that have not been reviewed against Consumer Duty outcomes in 2025 or 2026, a product audit is the appropriate starting point. Rather than a legal opinion, a product assessment based on user data and outcome evidence provides a clear, board-ready view of the current state. working well and does not need to change. Both matter when building the case for any subsequent investment.

To find out what that looks like in practice, speak to the Sonin to learn more about how this works, or contact the Sonin team.