Reed Smith Client Alerts

Key takeaways

  • Guidelines on Fair Dealing – Board and Senior Management Responsibilities for Delivering Fair Dealing Outcomes to Customers updated to apply to all financial institutions, the financial products and services offered by them, and their customers, effective from 30 May 2024
  • New guidance on differential treatment, product design, information accuracy, the use of right of review clauses and extra consideration for those who are more vulnerable
  • Updated guidelines came into effect on 30 May 2024, all financial institutions should ensure policies and practices are in line with the guidelines and monitor effectiveness

Introduction

On 30 May 2024, the Monetary Authority of Singapore (MAS) issued the updated Guidelines on Fair Dealing – Board and Senior Management Responsibilities for Delivering Fair Dealing Outcomes to Customers (Guidelines), which articulate MAS’ expectations on the role of the boards and senior management of financial institutions (FIs) in ensuring fair dealing outcomes for customers. The Guidelines came into effect on 30 May 2024 and are applicable to all FIs, the financial products and services offered by them, and their customers.

The Guidelines set out five fair dealing outcomes that FIs should deliver to their customers, namely:

  • Outcome 1: Customers have confidence that they deal with FIs where fair dealing is central to the corporate culture.
  • Outcome 2: FIs offer products and services that are suitable for their target customer segments.
  • Outcome 3: Customers are served by competent representatives.
  • Outcome 4: Customers receive clear, relevant and timely information that accurately represent the products and services offered and delivered.
  • Outcome 5: FIs handle customer complaints in an independent, effective and prompt manner.

For each fair dealing outcome, the Guidelines provide guidance and supervisory expectations for the boards and senior management of FIs to embrace, as well as self-assessment questions to help FIs evaluate their adherence to the Guidelines. We highlight below significant changes to the earlier version of the Guidelines that, in our view, require attention and prompt action by FIs as necessary.