What does 'fair value' look like in practice? Three years into the Consumer Duty, here’s what we’ve learned.

Fair value is a simple yet important principle at the heart of the Consumer Duty: the price customers pay should be reasonable, relative to the benefits they get. But applying that principle in practice requires judgement.Three years into the Consumer Duty, we’re seeing clear differences between firms that have embedded fair value into their approach and those that still need to strengthen their assessments, evidence and monitoring.We recently reviewed how firms across the consumer finance market assess, evidence and monitor fair value. We also carried out focused work on fees and charges across a range of credit products, and supervisory work on consumer hire and third-party ownership agreements for home energy infrastructure.Many firms are getting it right, building fair value into how they design, price and monitor their products. Others are missing things that, in hindsight, could have been avoidable. Where firms fell short, a recurring issue was the evidence supporting their conclusions.Here are 3 areas that separated the 2, and questions firms can use to challenge their approach to assessing and monitoring fair value.Does your evidence actually tell you something, or just des

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