1. Objective

 

• To ensure that Car-Holics Ltd identifies, supports, and treats vulnerable customers fairly, in compliance with the FCA’s guidelines and Consumer Duty requirements. This policy aims to provide additional care and support to customers who may be in vulnerable situations to ensure they receive appropriate services and outcomes.

2. Key Components of the Policy

 

• The key principles and components which underpins this policy are:

• Identification: Recognise and identify vulnerable customers promptly.

• Understanding: Understand the specific needs and circumstances of vulnerable customers.

 

• Support: Provide appropriate support and adjustments to meet their needs.

 

• Fair Treatment: Ensure vulnerable customers are treated fairly and with respect.

 

• Protection: Protect vulnerable customers from potential harm or exploitation.

3. Vulnerable Customers and Our Business Model

 

• We recognise that some of our customers may be categorised as vulnerable, due to either their financial profile or some mental and/ or physical impairment.

• As a Firm we pay due regard to the needs of all our customers and do not exclude particular customer groups but rather assess every customer or potential customer on their particular circumstances.

• In dealing with vulnerable customers, as with all other customers we ensure:

• Any credit we broker for a customer is appropriate, suitable and affordable given the customers particular circumstances.

• Customers fully understand the nature of the obligation.

• Our staff are trained to identify if a customer is vulnerable and are trained to discuss with customers their vulnerabilities.

• That we assess the customers personal circumstances and determine whether they fully understand what is being discussed, if deemed they do not understand then staff will escalate to the Senior Manager/SMF29.

• Customers are given as much time as they individually require to consider the finance that they have requested. Where we deem the circumstances appropriate we will recommend the customer seeks free independent advice or consult with family and/ or friends.

4. Definition of Vulnerable Customers

• Vulnerable customers are individuals who, due to their personal circumstances, are especially susceptible to harm, particularly when a Firm is not acting with appropriate levels of care. In accordance with Consumer Duty Cross Cutting Rules customers need to be given sufficient time so that they can choose a product that serves their best interests with sustainable borrowing. We have considered customers mental capacity with fair practices to identify what vulnerability our business could bring to customers which has allowed us to create a vulnerable customer policy that reflects our business model.

5. Identifying Vulnerable Customers

• Indicators of Vulnerability

• Health: Physical disability, mental health issues, cognitive impairments, chronic illness, drug/alcohol/gambling addiction.

• Life Events: Bereavement, divorce, job loss leading to low income/debt, or other significant life changes.

• Resilience: Low confidence, difficulty in dealing with Firms, or lack of support.

• Capability: Low financial literacy, lack of English language skills, difficulty understanding information, inexperienced due to young age, or poor decision-making skills.

• Methods of Identification

 

• Observation: Noticing signs of distress such as shortness of breath, confusion, or difficulty during interactions displayed through customer asking for repetition which is a sign the customer is not retaining information.
• Self-Disclosure: Customers may reveal their vulnerabilities during conversations where customers may mention contacting debt advisor or is having trouble paying any outstanding debt that they have.

• Third-Party Information: Information provided by family members, carers, or other third parties.

• Staff will receive comprehensive training on identifying and supporting vulnerable customers. This will include both practical guidance on handling specific situations as well as mental health and emotional support through access to resources such mental health charities such as Mind and the Samaritans Staff will be trained in empathy and active listening skills, and they will have access to regular debriefing sessions to discuss any challenging interactions they have experienced. This ensures that staff are well-equipped to support vulnerable customers effectively.

6. Supporting Vulnerable Customers

• Terminal illness / health

 

• If a customer is deemed to have a health issue, the Firm will support them by making sure that the product is actually needed by a customer and that it would not further exacerbate their health vulnerability through added pressure or placing them at higher risk of harm. We would also signpost the customer to the NHS and/or a relevant mental health charity such as Mind, Alzheimer’s Society, Age UK, NHS.

• Mental Health

• Assessing a person’s mental health is complex but needs to be recognised in early contact and needs to be addressed appropriately. To establish the following questions should be asked to the customer:

• (a) Does customers mental health affect their financial situations?

• (b) Does it affect customers’ ability to deal with or communicate with us?

• (c) Does anyone help the customer manage their finances?

• Additionally, when identifying vulnerabilities we will look out for whether the customer is able to understand what is being said to them or if they are forgetful. If the customer asks unrelated questions or begins to talk about unrelated matters. All of which could be indicators of vulnerability.

• If a customer is deemed to have mental health or other mental capacity issues in such a way that it would prevent the customer from making an informed decision due their impairment the Firm would support them by:
  • Offering customers to bring family members or advocates who can support them and help them make decisions

• Offering additional time for decision making for customers wo may need more time to make decisions due to cognitive challenges or anxiety so that they calculate the benefits and disadvantages of the product offered.

 

• Financial Literacy

• If a customer is deemed to have low levels of financial literacy, the Firm will take appropriate steps to explain the product and processes in simple and clear terms without using technical jargon. Furthermore, it would explain everything in a simplified manner tailored to the customer’s level of understanding. We will also signpost customers to such charities as Money Advice Trust, and StepChange.

• In the event a customer is deemed vulnerable through indicators the organisation has identified or if the customer discloses information that renders them to be a vulnerable customer, we will use clear and simple language to confirm their understanding. Provide information in accessible formats (e.g., large print, Braille, audio).

• We will ask questions to understand their circumstances and needs to better communicate with customers considering the vulnerabilities identified. Offer additional help with form filling, explanations of terms, or accessing services. This is a responsibility of our business to remove barriers for customers and should consider this policy document when interacting with any customer or potential customer to highlight and identify potential vulnerabilities

• The Firm will allow a trusted third party to assist the customer if needed such as debt advice charities, Citizens Advice Bureau, and the Samaritans.

• Finally, we provide additional time for decision-making and consider flexible payment arrangements.

 

• Support for Hearing Impairments

• Car-Holics Ltd will implement specific measures to assist customers with hearing impairments. This includes offering communication support such as access to sign language interpreters or use of assistive communication devices when required. Staff will be trained to recognise hearing impairments and to adapt communication methods accordingly to ensure customers fully understand the information provided.

• Addressing Digital Exclusion

• The Firm recognises that some customers may experience digital exclusion due to lack of access to or familiarity with digital technologies. To accommodate these customers, Car-Holics Ltd will provide alternative communication channels, including in-person and telephone support. Information and documents will be made available in non-digital formats upon request to ensure equal access to services.

• Where vulnerability is identified or suspected, the Firm will apply additional prominence measures to support understanding, including: slower pacing, simplified written summaries, accessible formats (where required), extra time/pauses before proceeding, and teach-back questions to confirm comprehension of broker status, commission, key risks and total cost of credit. These adaptations align with the “Prominence and Layered Communications”procedure in the Financial Communications and Promotions Policy and will be recorded on the customer file.

• Language Support Services

 

• To overcome language barriers, Car-Holics Ltd will make available translation and interpretation services for customers with limited English proficiency. This may include access to professional interpreters or translated written materials to ensure customers fully understand product terms, conditions, and their obligations. Staff will be trained to identify language barriers early and to facilitate the use of these services promptly.

7. Training and Awareness

• Should the business expand and employ staff then Staff Training will take place: Regular training for all staff on how to identify and support vulnerable customers, including recognising indicators of vulnerability and understanding appropriate responses.

• We will record any disclosed vulnerabilities of customers in a secure and confidential manner. This information will be stored in our customer relationship management (CRM) system, ensuring that only authorised personnel (which is currently, only myself) can access it. Detailed notes about the customer’s vulnerabilities and specific needs will be included in their profile. This information will be retrievable by future staff to ensure that all customer interactions are conducted with an awareness of their needs. Training will be provided to all future staff on how to handle and retrieve this information sensitively and appropriately.

• Use real-life scenarios and role-playing exercises to help staff practice handling situations involving vulnerable customers.

• Continuously update training materials and sessions based on new regulations, guidelines, and best practices.

• Training Implementation Plan (Vulnerability) – Induction, Competence, Refreshers and Records
  • Before any staff member has customer contact, the Firm will provide mandatory induction training covering:

• (a) Consumer Duty (cross-cutting rules and the four outcomes) and how the Firm evidences good outcomes;
• (b) identifying and supporting vulnerable customers (including typical vulnerability drivers in the Firm’s customer base, how vulnerability can be dynamic, and how to record vulnerability flags sensitively);
• (c) customer communications and “prominence” requirements (clear, fair and not misleading communications; layered disclosures; verbal pause points; teach-back checks);
• (d) complaints handling (DISP), including identifying and supporting vulnerable complainants and record-keeping;
• (e) avoiding commission-driven sales bias and conflicts of interest (including escalation requirements where bias risk is suspected);
• (f) data protection and confidentiality (GDPR principles, secure handling of vulnerability data, and access controls within the CRM).

• Competence assessment (sign-off): The Firm will assess competence before a staff member conducts finance-related discussions independently. Competence assessment will include:

• (a) a short knowledge check (pass / fail threshold set by SMF29);
• (b) role-play scenarios (vulnerability identification, teach-back checks, and explaining commission/total cost of credit);
• (c) observed interaction sign-off by SMF29 (or a delegated competent supervisor), with remediation where standards are not met.

• Refreshers and ad-hoc updates

• (a) Quarterly micro-learning (15–30 minutes) covering key vulnerability themes, common errors, and recent case learnings;
• (b) annual full refresher training (including updated FCA expectations and internal lessons learned);
• (c) Ad-hoc targeted updates and coaching following any MI trigger, complaints theme, QA findings, or regulatory change that indicates a need to strengthen competence.

• Training records and remediation: The Firm will maintain a central Training Log recording: attendance, module completion, assessment results, role-play outcomes, sign-off status, and any remedial actions. Where performance concerns are identified (e.g., repeated teach-back failures, weak disclosures, or customer misunderstanding), the Firm will implement a documented remediation plan (coaching, re-training, re-assessment and, where necessary, restriction of duties until competence is re-confirmed).

 

8. Monitoring and Evaluation

• Conduct regular reviews of customer interactions to ensure vulnerable customers are being identified and supported appropriately.

• Implement feedback mechanisms to gather insights from vulnerable customers and improve service delivery.

• Include vulnerability assessments in compliance audits to ensure adherence to this policy.

• Management Information (MI), Governance and Escalation (Vulnerable Customers)

• The Firm will capture and review vulnerable customer MI monthly to monitor whether customers in vulnerable circumstances are receiving appropriate support and to evidence good outcomes. As a minimum, the Firm will record:

• total finance enquiries and total finance submissions;
• number of customers identified / flagged as vulnerable and the stage at which vulnerability was identified;
• vulnerability driver/characteristic type (e.g., resilience, capability, health, life event, communication needs, digital exclusion);
• accommodation provided (e.g., adapted channel/format, translation/language support, extra time/pause, trusted third-party support);
• time to accommodate / number of additional touches required (e.g., additional calls, follow-ups, re-explanations);
• outcomes (proceeded / withdrew / declined) and reasons (where known).
• complaints involving vulnerable customers, including root cause category and any redress/remediation; evidence of customer understanding (teach-back pass/fail and number of re-explanations).

• The Compliance Officer/SMF29 will review vulnerable customer MI monthly and will record actions taken (if any). Director will review a quarterly summary to ensure oversight and continuous improvement. MI and decisions will be retained within the Firm’s CRM/Compliance Log with appropriate access controls.

 

• Any of the following will trigger escalation to SMF29 for immediate review and, where appropriate, a process change and/or staff retraining:

 

• 10% or more of finance customers flagged as vulnerable for two consecutive months;
• any vulnerable-customer complaint indicating misunderstanding of commission disclosure and/or total cost of credit;
• a 5% or higher “teach-back fail” rate in any month (or any recurring pattern of re-explanations indicating weak customer understanding);
• repeated themes in complaints, cancellations, withdrawals or lender declines indicating possible target-market mismatch or inadequate support controls.

• Where escalation is triggered, the Firm will complete root cause analysis, implement corrective actions (e.g., documentation changes, script changes, additional training), and record the outcome and follow-up testing to confirm effectiveness.

9. Complaint Handling

• When handling complaints involving vulnerable customers, ensure the complaints process is easy to access and understand for vulnerable customers, where access can be via website or written format.

• Handle complaints from vulnerable customers with additional care and sensitivity.

• Provide clear and timely responses to complaints, with a focus on fair resolution and learning from feedback to improve practices.

 

10. Record Keeping

• Maintain detailed records of interactions with vulnerable customers, including identified needs, support provided, and any adjustments made.

• Ensure all records are kept confidential and comply with data protection regulations.

11. Staff Support for Engaging with Vulnerable Customers

 

• Car-Holics Ltd recognises that dealing with vulnerable customers can sometimes place emotional and practical demands on sales staff. To ensure that our staff are supported in these situations, we have implemented processes to provide both practical and emotional support.

• This includes access to mental health resources such as counselling services, emotional support hotlines (e.g., Mind and Samaritans), and debriefing sessions where staff can share challenging experiences and receive peer support. Additionally, regular supervision and one-on-one meetings with senior management will be conducted to ensure that staff have the guidance they need to handle difficult interactions. Training on empathy, active listening, and stress management will also be part of our ongoing development program to ensure staff are well-prepared and supported in their roles.

 

12. Continuous Improvement

• Regularly review and update the Vulnerable Customers Policy to ensure it remains current with FCA guidelines and best practices.

• Stay informed about industry best practices and incorporate them into business operations.

 

 

STATEMENT OF COMMITMENT

 

Car-Holics Ltd is dedicated to treating all customers, especially those who are vulnerable, with fairness, respect, and compassion. We recognise the importance of identifying and supporting vulnerable customers to ensure they receive appropriate products, services, and outcomes tailored to their individual needs and circumstances.

Our Firm commits to fostering an inclusive culture where vulnerable customers are recognised promptly, supported effectively, and protected from harm or exploitation. We will provide our staff with comprehensive training and resources to ensure they are equipped to meet the challenges of supporting vulnerable individuals.

Car-Holics Ltd pledges to maintain clear policies and procedures aligned with FCA guidelines and Consumer Duty principles, and to continuously monitor, review, and improve our practices in response to emerging needs and regulatory expectations.

Through this commitment, we aim to build trust and deliver positive, sustainable outcomes for all our customers.