Context
The Financial Services Consumer Panel (FSCP) is an independent statutory body representing the interests of individuals and Small and Medium-size Enterprises (SMEs). The FSCP has, this week, published a number of response letters to Consultations and current issues, in relation to the FOS Consultation on Interest on compensation awards, the FCA Consultation Paper CP25/12: ‘Simplifying the Insurance Rules’, the PRA proposals in connection with the limit of protection available from the FSCS, and to the FCA about the key considerations in implementing a possible motor finance consumer redress scheme.
Key points to note and next actions
- The letters were written on 2nd July or 30th June 2025.
- In relation to the FOS interest awards Consultation, the FSCP strongly recommended that FOS did not change its current approach and retained the 8% simple interest ate used in determining interest awards.
- In relation to the FCA’s Consultation on simplifying insurance rules, the FSCP supports the FCA’s intention, particularly as it enhances the financial services protections available to sole traders and smaller businesses buying standardised insurance product solutions. The FSCP re-stated its long-held position that consumers, microbusinesses and most smaller SME firms should enjoy the same level of safeguarding and protection as provided for in ICOBS, PROD, PRIN and the ability to bring cases to FOS and the FSCS.
- The FSCP is supportive of proposals to increase the current FSCS limits to reflect the impacts of inflation since the current limits were implemented. The response notes that, based on changes to CPI, £85,000 in January 2017 has increased to £113,669 as at 31st December 2024. The FSCP understands why the PRA is proposing a new limit of £110,000, but urges the PRA to reconsider whether a new limit of £115,000 would be more appropriate.