The FCA’s consumer duty turns three on 31 July 2026, or two, if you consider the inclusion of legacy products its proper date of birth. Either way, it’s a toddler. But like most toddlers, it’s having a significant impact on daily life.

There were many naysayers about the duty when it was first introduced – some saying it went too far and others suggesting it didn’t go far enough – but lots of commentators would now accept it has been a force for good. Like most sweeping changes, putting it into practice reveals elements that work better than others, and the regulator has recognised this in its recently proposed changes, particularly around reporting requirements and firms operating in a supportive capacity to those dealing directly with consumers.

My characterisation at the time was that it essentially sought to move the thinking of regulated firms from ‘treating customers fairly’ to ‘treating customers well and proving it’. That is to say, the days of standing behind small print in disclosures are gone, and the focus is now firmly on outcomes as opposed to simply outputs.

This is an advancement in thinking and one which, over time, should lead to greater trust. Perhaps even greater engagement in financial services and the many benefits the sector provides in securing people’s resilience in life.

But like any toddler, there is still a lot to learn.

The regulator’s most recent survey identified some shortcomings in how firms were measuring customer outcomes. Broadly speaking, it makes the point that simply collecting the data isn’t sufficient, with a need to demonstrate how that data is used and acted upon.

Again, there are critics who suggest too much time is spent on supervising firms that are essentially trying to do the right thing, and not enough time catching the bad actors who are causing serious harm. But investing the time now to fine tune the duty may well free up the time the regulator needs to channel its resources more effectively in future, safe in the knowledge that the vast majority of firms it regulates are generating good outcomes for their customers and clients.

It’s not easy measuring customer outcomes on a grand scale, stepping into their shoes to understand whether products and services are working as intended.

Technology will help, of course, and AI provides near limitless opportunities to re-engineer products and services with the duty in mind. I’ve heard extraordinary examples from advisers, where the deployment of agents is transforming the way they work with clients, or simply freeing up time which can be spent in more value-adding ways, including direct adviser and client engagements.

There are also many examples of how AI is being deployed to identify client vulnerabilities, which may not otherwise reveal themselves other than through face-to-face meetings.

The Mills review rightly identifies that AI does not change the central role of the consumer duty, although it may change the way in which people evidence compliance with it. In essence, the onus is on firms to demonstrate that any AI deployment must continue to serve the purpose of acting to deliver good outcomes, delivering fair value, improving consumer understanding and providing appropriate support.

This is a good way to look at the challenge of regulating AI in the context of financial services. Writing a rule book for that would be near impossible, given the rate of technological advancement and the breadth of its application.

It would be like trying to write down everything a toddler needs to know about life and teach them there and then.

The duty turns three at a time when large swathes of the population are under-saving for retirement, are under-protected for adverse life events and have little or no savings to deal with life’s everyday challenges.

Our recent Financial Resilience research shows that nearly one in five UK adults have less than £100 in cash savings, with a similar number only able cover bills for one month or less if they or their partner couldn’t work due to illness. Getting the duty right could drive real change.

Ultimately, the consumer duty is a cultural shift. If we get that mindset right, we stand to improve many more people’s lives and increase the trust people place in us to do so.

That must be a good thing.

Let’s nurture this toddler to become a pillar of the financial services community.

Jamie Jenkins is policy director at Royal London.