Analysis: How AI is helping customer care teams spot vulnerability

Customer service, and other frontline roles must ensure proper standards are in place to protect every customer during every engagement writes Muj Choudhury, CEO and founder of RocketPhone

Roughly half of adults in the UK are classified as vulnerable. The Financial Conduct Authority and other regulatory bodies emphasize the fair treatment of vulnerable customers as a priority for businesses. The FCA identifies a spectrum of risk based on characteristics such as poor health, life-changing events, and low resilience to financial or emotional shocks.

The FCA is tightening regulations on how businesses protect vulnerable customers, with significant consequences for non-compliance. Detecting at-risk customers early, tailoring communications, and ensuring compliance are essential. Failure to do so can result in sanctions, public scrutiny, reputational damage, and even legal action.

Not one-size-fits-all

The FCA mandates that all customers receive consistent and fair treatment. Businesses that fail to comply face serious consequences. For instance, TSB Bank was fined nearly £10.9 million last year for mistreating financially vulnerable customers.

Sales and customer service teams are responsible for maintaining high standards across all interactions. The FCA is currently conducting a comprehensive review of firms’ approaches to consumer needs, staff capabilities, and customer service. Findings from this review will be released by the end of Q1 this year.

Beyond regulation, businesses that fail to recognize customer vulnerability risk losing trust. Negative customer experiences have lasting impacts, and companies that fail to meet diverse customer needs may struggle to rebuild their reputations.

Detecting vulnerabilities

Sales teams, particularly those relying on cold outbound communications, must balance hitting targets with fair treatment of customers. However, spotting vulnerabilities is not always straightforward.

Sales teams often face administrative burdens, including updating CRMs in real-time while researching prospects, following up, and meeting KPIs. For optimal service, teams need access to complete communication histories, but manual CRM updates can be time-consuming and error-prone. As a result, crucial customer data can become fragmented across multiple systems, making it difficult to identify vulnerabilities.

Given the challenge of spotting vulnerabilities, how can businesses ensure compliance with FCA standards?

Exceptional service with AI

AI can assist businesses in two key ways: detection and  accurate data reporting**.

AI tools can monitor and analyze customer conversations in real time, flagging potential risk indicators. These insights can then be reviewed by teams to trigger necessary actions. Early detection enables businesses to take appropriate steps before any sales occur, ensuring compliance with FCA regulations.

Additionally, AI can streamline administrative tasks such as note-taking and CRM updates. Automating these processes ensures accurate records of customer interactions, reducing errors and freeing up sales teams to focus on meaningful engagements that enhance customer relationships.

 Protecting existing and future customers

As customer interactions expand to new channels, such as video, businesses must refine their processes for identifying and supporting vulnerable customers. With stricter regulations on the horizon, compliance is not optional.

AI-driven solutions offer a powerful opportunity to enhance customer care and regulatory adherence. Sales teams, in particular, can benefit from AI’s ability to provide real-time insights, helping them adjust their approach and offer the appropriate support for every customer.

By leveraging AI, businesses can not only meet regulatory requirements but also build stronger, more trustworthy relationships with their customers.