We’ve responded to three consultations focused on the Financial Ombudsman Service (FOS) and the UK’s redress framework. We believe that a stable and well-functioning redress system is crucial for supporting the type of innovation that is needed to deliver better access and outcomes for consumers in financially vulnerable circumstances.

Across our three recent consultation responses, we emphasise the importance of aligning the FOS more closely with the Financial Conduct Authority (FCA), improving consistency and transparency, and creating a redress environment that supports financial inclusion.

We support proposals that promote closer alignment between the FOS and the FCA, including clearer mechanisms for referring questions of rule interpretation or issues with wider implications. Reducing uncertainty and inconsistency between regulatory decisions and ombudsman outcomes should give lenders and investors greater confidence to serve excluded and underserved customers, while maintaining robust consumer protection.

We also welcome plans for greater transparency, including thematic guidance from the FOS on how cases are assessed. This would help firms understand good practice and give consumers confidence that complaints are resolved fairly and consistently. We believe that it is crucial to maintain the current statutory obligation for the FOS to publish individual determinations, alongside this.

We strongly support the FCA’s proposals to modernise the redress system and improve how systemic issues are identified and addressed. Clearer guidance for firms on identifying and reporting potential harms early, including those that disproportionately affect vulnerable consumers, will help ensure a more timely and coordinated regulatory response.

We also support the introduction of a ‘lead complaints’ process to manage novel or significant issues, and a new registration stage at the FOS to improve efficiency. These changes should help streamline case handling, ensure consistency across decisions and reduce operational burdens for firms – provided that appropriate safeguards are in place to protect access to redress for vulnerable consumers.

In our response to the FOS consultation on evolving its funding model, we support the proposal for differentiated case fees – ensuring that costs reflect the complexity and stage of each complaint. We also urge the introduction of reduced case fees for small-sum loans (under £1,000) and a broader exemption for Community Finance Organisations (CFOs).

These changes would make it more viable for responsible lenders to offer affordable credit products and help widen access to fair financial services for the millions of people currently excluded from mainstream credit.

Taken together, the reforms proposed across these consultations have the potential to build a redress system that works better for both consumers and firms.

A system that is transparent, consistent and proportionate will allow firms to innovate confidently and invest in inclusive financial products, while ensuring that consumers – including those in financially vulnerable circumstances – continue to have access to fair and effective redress.

We look forward to continuing to work with HM Treasury, the FCA and the FOS to help shape a redress system that supports both financial inclusion and sustainable market growth.