MorganAsh comments on BoE MPC decision

02 November 2023

MorganAsh provides the MorganAsh Resilience System (MARS) to enable brokers, advisers and financial services firms to better manage and evaluate consumer vulnerability and comply with Consumer Duty.

Andrew Gething, managing director of MorganAsh, said: “After so many successive rises, news that the base rate will remain unchanged is certainly positive. This continuity will be most welcome among the proportion of borrowers who are on tracker or variable rate mortgages, providing some much needed certainty for what will be one of their largest monthly outgoings.

“While no increase is good news, the expectation is that rates will stay at an elevated level for much longer as sticky inflation remains a clear obstacle. Alongside challenges in the wider economy – particularly around wage growth – the Bank of England will also have one eye on a jump in mortgage arrears. Even with the consensus that inflation will continue to trend downwards, future rises are certainly not off the cards. With sustained pressure on household budgets, firms across financial services must stay close to clients to identify their potential stresses and vulnerabilities.

“This is of course a key pillar of Consumer Duty – and the clear requirement for all financial services firms to deliver good outcomes for clients. As the FCA highlighted recently, firms should not be treating the regulation as a ‘one and done’ box-ticking exercise. Instead, it should become a fundamental part of each business’s core operations, procedures and culture. In particular, monitoring outcomes for different groups (including the vulnerable) must remain a priority – an onerous task without the necessary technology to identify and monitor all clients.”