Executive Summary

FCA complaints reporting reform (2027): vulnerability data becomes mandatory so firms must upgrade taxonomy, data capture and vulnerability reporting

From 1 January 2027, the Financial Conduct Authority (FCA) will introduce a new consolidated complaints reporting regime that significantly enhances how firms must capture and report complaints data, particularly where customers are in vulnerable circumstances.

The reform replaces multiple legacy returns with a single, standardised 6-monthly complaints return, introduces a revised taxonomy of complaint types, and requires firms to collect specific vulnerability-related data points for the first time across all regulated firm types.

The changes align closely with the FCA’s broader shift toward outcomes-based supervision, reinforcing expectations under Consumer Duty and the FCA’s Vulnerability Guidance (FG21/1).

For many businesses, the practical impact is substantial: complaints data structures, taxonomies, case tagging processes and management information (MI) frameworks will need updating well in advance of 2027.

CourtCorrect AI can help companies transition efficiently by mapping legacy datasets into the new taxonomy. As well as using AI to identify vulnerability-related complaints with 95%+ accuracy, ensuring compliance with minimal operational disruption.

FCA complaints reporting reform: what is changing and why it matters

The FCA has finalised reforms designed to simplify complaints reporting while giving the regulator better visibility of whether firms are delivering fair outcomes, especially for customers in vulnerable circumstances.

The new framework introduces three key changes:

1. A single consolidated complaints return

Five existing complaints returns will be replaced by one standardised return covering companies currently reporting under:

• DISP complaints reporting

• Consumer credit complaints returns

• Claims management complaints returns

• Funeral plan complaints returns

• Electronic money and payment services complaints returns

This simplifies reporting architecture while improving comparability of data across sectors.

2. A common 6-monthly reporting cycle

All firms will move to fixed reporting periods:

• 1 January to 30 June

• 1 July to 31 December

This replaces the current model, which often depends on each firm’s accounting reference date.

3. Mandatory vulnerability complaints metrics

The most significant substantive change is the introduction of mandatory reporting of complaints involving vulnerable customers.

Businesses will need to capture four specific vulnerability data points:

• complaints opened by customers identified as vulnerable

• complaints closed by customers identified as vulnerable

• complaints alleging failure to identify, consider or respond to vulnerability

• complaints closed relating to alleged failures in responding to vulnerability

These metrics reflect the FCA’s four drivers of vulnerability:

• health

• life events

• resilience

• capability

Importantly, companies must identify complaints involving vulnerable customers even where vulnerability is not the cause of the complaint.

Timeline for implementation

Although the policy direction is now settled, the FCA is continuing industry engagement and technical validation ahead of implementation.

Businesses should therefore expect further operational guidance and supervisory communications, but not fundamental changes to the core requirements.

How the new regime differs from current complaints reporting rules

Many companies already report complaints data bi-annually under DISP rules, including metrics such as:

• number of complaints opened

• root cause categories

• time to resolution

• uphold rates

• redress paid

• complaints per 1,000 accounts or policies

However, the new regime introduces several material changes:

Structural changes

• single consolidated return replaces multiple forms

• group reporting removed (data reported at legal entity level)

• explicit reporting of complaints outstanding at the start of each period

• revised and more granular complaint taxonomy

• consistent reporting periods across all firms

Data changes

• mandatory vulnerability-related metrics

• clearer categorisation of complaint focus

• improved contextualisation data

• reduced reliance on “other” categories

Taken together, these changes significantly increase the importance of structured complaints data as a supervisory tool.

Relationship with Consumer Duty

The reforms are closely linked to the FCA’s wider regulatory agenda, particularly the introduction of Consumer Duty.

Consumer Duty requires firms to demonstrate that customers receive good outcomes, including customers in vulnerable circumstances.

The FCA has made clear that businesses should already be monitoring outcomes for vulnerable customers as part of their Consumer Duty obligations.

The enhanced complaints reporting dataset enables the FCA to:

• assess whether vulnerable customers experience worse outcomes

• identify systemic issues affecting vulnerable cohorts

• evaluate whether firms respond appropriately when vulnerability is disclosed

• detect emerging harm more quickly

Complaints data is therefore becoming a central supervisory dataset for evidencing Consumer Duty compliance.

How CourtCorrect AI supports firms transitioning to the new regime

CourtCorrect AI enables companies to move seamlessly into the new FCA reporting framework through a combination of structured data mapping and advanced AI classification.

1. Automated data mapping to the new FCA taxonomy

CourtCorrect performs detailed mapping between a firm's existing complaints dataset and the new FCA categories, including:

• complaint focus taxonomy

• product and service classification

• contextualisation denominators

• vulnerability indicators

This ensures businesses can transition into the new reporting structure without extensive manual reclassification exercises.

Where legacy datasets contain inconsistent or incomplete tagging, CourtCorrect uses AI-assisted classification to improve data consistency and accuracy.

The result is a clean, regulator-ready dataset aligned with the 2027 reporting requirements.

2. AI identification of vulnerable customers and vulnerability-related complaints

The CourtCorrect platform includes AI models capable of identifying indicators of customer vulnerability across complaint narratives and supporting documents.
The platform now extends this capability through a dedicated model that identifies complaints involving:

• customers in vulnerable circumstances

• allegations that the firm failed to identify or appropriately respond to vulnerability

These models operate with 95%+ accuracy, enabling firms to reliably capture the new mandatory vulnerability metrics.

CourtCorrect supports two implementation approaches:

A) Businesses using CourtCorrect for business-as-usual complaints handling

AI flags vulnerability indicators directly within complaint cases, enabling handlers to:

• confirm or refine vulnerability classifications

• ensure accurate data capture

• improve customer outcomes

• generate reporting-ready MI automatically

B) Businesses using CourtCorrect for dataset enrichment

Where firms maintain their own complaints handling systems, CourtCorrect can:

• scan historic or live complaint datasets

• apply vulnerability and taxonomy classifications

• enrich datasets with FCA-aligned metadata

• enable rapid generation of compliant reporting outputs

This supports a low-disruption transition even where firms do not wish to replace their existing complaints platform.

Preparing now reduces implementation risk

Although the new reporting requirements take effect in 2027, businesses should begin preparation well in advance, particularly where complaints data is fragmented across systems or inconsistently classified.

Key preparation steps include:

• reviewing current complaints taxonomies

• assessing ability to identify vulnerable customers consistently

• evaluating MI capability for Consumer Duty monitoring

• ensuring complaints systems can capture the new data points

Early preparation reduces the risk of manual remediation exercises later.

Book a demo

CourtCorrect AI helps firms achieve compliance with the new FCA complaints reporting framework efficiently and confidently. To see how CourtCorrect can support your transition:

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Email: hello@courtcorrect.com

CourtCorrect AI enables companies to transform their complaints processes, supporting better regulatory outcomes and better customer outcomes simultaneously.