Consumer Welfare Report

The report uses a range of evidence to assess the extent to which consumer interests are being served within each of these three broad pillars. It takes a holistic approach, examining consumers’ overall experience and outcomes, rather than attempting to assess how well consumers are served in specific markets.

For each pillar, the report:

• Presents data on a number of core outcome indicators, intended to show how consumer outcomes have evolved over time or differ for different groups. There are 14 core indicators in total, see below
• Highlights, through a series of spotlights, some key examples of the issues that affect these outcomes. The spotlights cover examples both of how the evolution of products and markets affect consumers, as well as examples of how policy can respond.

The cross-cutting and holistic nature of consumer welfare means the report is necessarily broad. It encompasses a range of reserved and devolved policy issues, including the evolving regulation of a wide range of different consumer issues, the enforcement of consumer regulation, the design of affordability policy, and the provision of consumer advice.

The report has a focus on the extent to which consumer interests are being served for different groups of consumers. It pays particular attention to consumers in vulnerable circumstances (Spotlight 1.1). But it also considers the variation in consumer outcomes across factors including geographical location, and protected characteristics including age, sex and disability.

The report also considers the experience of micro and small business consumers in Scotland. Scotland’s 350,000 micro and small businesses are purchasers of goods and services, and as such are defined as consumers in the Consumer Scotland Act (2020).

Consumer Welfare Core Indicators

Access and affordability indicators:

• Percentage of individuals living below the Minimum Income Standard in Scotland
• Percentage of consumers who struggled to afford food, energy or housing in the past 12 months
• Percentage of households in Scotland living in fuel poverty
• Percentage of all respondents in energy debt in arrears
• Percentage of households in Scotland with internet access
• Percentage of banked adults who do not access services online

Protection and redress indicators:

• Percentage of consumers who experienced at least one detriment incident in the last 12 months
• Percentage of consumers who experienced a safety issue with a product in the past 12 months
• Percentage of consumers who feel confident they can recognise misleading or unclear information about items or services
• Percentage of consumers who have fallen victim to a scam in the past 12 months
• Percentage of consumers who feel well protected when buying goods and services

Confidence and empowerment indicators:

• Percentage of consumers who feel like confident and savvy consumers
• Percentage of consumers who are confident in understanding their consumer rights
• Percentage of consumers who know where to look for reliable information about items and services

Spotlight 1.1: Consumers in vulnerable circumstances

Consumers in vulnerable circumstances are those who, due to their personal circumstances, are especially susceptible to harm.

A number of factors increase the risk of experiencing vulnerability. These include: being in poor health; having low financial resilience (such as low-income and/or limited ability to withstand financial shocks); experiencing negative life events such as bereavement or job loss; and having low capability (which could include low financial literacy or digital capability, or limited confidence in understanding consumer rights). [2]

Any consumer can experience vulnerability. Consumer vulnerability can be temporary, sporadic or permanent; consumers may move in and out of states of vulnerability over time and may not be vulnerable in all situations; and vulnerability can often be experienced because of factors outside the individual’s control.[3]

Consumers who experience vulnerability may be more likely to experience harm because they are less able to represent their interests, have different needs, or are more prone to behavioural biases that affect their decision-making.

Throughout this report we examine how consumer experiences and outcomes differ for consumers who have characteristics of vulnerability. In presenting the findings from our Consumer Welfare Survey, we consider the outcomes for consumers who experience various characteristics of vulnerability, and present findings for consumers who are experiencing more than one of these vulnerability risk factors simultaneously:

• Has a disability or health problem that either limits them a lot or a little;
• Has low financial resilience – defined as either having fallen behind on at least some bills and commitments or would be unable to pay an emergency expense;
• Has low digital confidence – defined as having low self-reported confidence using the internet.

In total, 59% of respondents to the survey had no characteristic of vulnerability, 30% had one characteristic of vulnerability and 11% experienced more than one characteristic of vulnerability.

Approach

Our approach to this report was underpinned by stakeholder engagement from the outset. The report itself draws on a wide range of evidence, supplemented by a survey of consumers in Scotland – the Consumer Welfare Survey – that was undertaken specifically to inform this report.

Stakeholder engagement. We engaged with a number of consumer landscape stakeholders on a bilateral basis to hear views on our proposed approach to the CWR, and stakeholders’ views on key issues for inclusion. These bilateral meetings were supplemented by a workshop session at the Consumer Network – Consumer Scotland’s forum for engaging consumer landscape stakeholders in Scotland – in March 2026, and a discussion at the Committee on Consumers in Vulnerable Circumstances – an advisory Committee to Consumer Scotland – in November 2025. We are grateful for the time and contribution of all stakeholders involved.

Evidence assessment. Throughout this report we draw on a wide range of data and evidence to assess the core statutory questions – how well are consumers served, and what is the nature of any harm? This evidence includes analysis of data, statistics and research produced by the Office for National Statistics, the Scottish Government, regulators, research bodies, the third sector, and other bodies, including Consumer Scotland’s research.

As part of this assessment of evidence, we identified a series of ‘core indicators’ of consumer outcomes. These core indicators were identified through an appraisal exercise, which assessed a long-list of potential indicators against criteria which included: relevance, timeliness, potential for disaggregation across consumers groups, and frequency and consistency in collection over time.

The data underpinning the core indicators used in this report is available on Consumer Scotland’s Consumer Welfare Dashboard. The Dashboard is an online tool which enables users to explore the data underlying the core indicators in a bespoke way.

Consumer Welfare Survey. We undertook a survey of consumers in Scotland to inform this report. The Consumer Welfare Survey was designed to explore respondents’ experiences of being consumers in Scotland – including issues in accessing or being able to afford essential goods and services, their experiences of different forms of consumer harm and the resolution of issues experienced, and their knowledge of their consumer rights and confidence in asserting those rights.

The survey was completed by 2,034 respondents. It was predominantly an online survey, but also included 50 telephone interviews with digitally excluded consumers to ensure representation from this group. Fieldwork took place between 5th May and 29th May 2026. The survey data presented in this report is weighted by age, gender, region, urban/rural classification and household income, to ensure it is representative of all Scottish adults (aged 18+). Further details on the survey are available in Chapter 6.

Spotlight 2.1: Household expenditure in Scotland

Household spending is not a perfect measure of what households ‘consume’. For one thing, households can consume public services, which are not associated with expenditure directly. Furthermore, there can be differences in the timing of when households pay for something and when they consume the services they get from that thing – particularly in cases where they borrow to pay for something, or where they purchase a durable item which they may then use for many years. Nonetheless, understanding how households spend is important for assessments of consumer wellbeing.

Households in Scotland spent an average of £530 per week in 2024/25. Amongst the most significant categories of expenditure were housing (including energy) at £90 per week; transport (£80 per week – which includes the costs associated with purchasing vehicles averaged over time); recreation and culture (£70 pw) and food (£65 pw).

On average, households in Scotland spend somewhat less than the average expenditure across UK households, which is around £620 pw. But patterns of expenditure are broadly similar between Scotland and the UK. For example, transport accounts for 15% of total spending in Scotland v. 14% in UK; food accounts for 12% of household spending in Scotland compared to 11% in UK; housing accounts for 17% of household spending in Scotland compared to 18% in UK (in Scotland, higher spending on energy offsets lower costs associated with housing itself).

What is more significant than differences between consumers in Scotland and those in the UK are the differences between types of consumer within Scotland.

Of particular note, households with different levels of income can exhibit widely different expenditure patterns. Because certain goods and services are essential, households with lower incomes tend to spend more as a percentage on those categories. As shown in Chart 2.2, expenditure on food is 17.5% of total expenditure for households in Scotland in the lowest fifth by income and 9.3% for households in the highest fifth. Energy costs account for 13.3% of expenditure for the lowest income fifth but only 5.2% for the highest. Lower income households also spend proportionally more on overall housing costs (which includes energy) and communication, and proportionally less on transport, recreation and restaurants and hotels.

Patterns of household expenditure also differ by factors such as household composition, and age.

The takeaway is that patterns of expenditure are generally similar between Scotland and the UK – but can vary substantially between consumer groups within Scotland.

Households with lower incomes tend to spend a greater proportion of total expenditure on essential services.

The legacy of these price increases can be seen in a number of measures of households’ financial precarity. For example:

There has been a rise in the proportion of individuals living in households whose income does not meet the ‘Minimum Income Standard’. The Minimum Income Standard (MIS)[5] defines the income households need to achieve a socially acceptable standard of living, ensuring they can meet basic needs and participate fully in society. Chart 2.3 shows that, in 2023/24, almost one third of individuals (32%) in Scotland were living in households whose income does not meet the MIS, a rise from just over one quarter before 2022.

Consumer Scotland’s Consumer Welfare Survey found that, in 2026, one in five respondents report ‘often’ or ‘always’ struggling to afford at least one essential household cost (energy, food, or housing) during the past 12 months (Chart 2.4). 13% of respondents had struggled to afford food either ‘often’ or ‘always’ during the past 12 months. Similarly, 12% had struggled often or always to afford energy, and 13% had struggled often or always to afford essential housing services.

These affordability challenges disproportionately affect younger people, women, the unemployed, disabled people, and lower-income households. These households often responded to the cost of living crisis by reducing their consumption of essentials, or borrowing to maintain consumption.[6] 

A significant minority of consumers in Scotland experience some form of consumer-related poverty. Different forms of poverty can overlap within households, with difficulties meeting one essential need potentially contributing to, or compounding, difficulties in meeting others. Non-exclusive examples relate to fuel poverty, food insecurity and water poverty:

• Fuel poverty. The fuel poverty rate rose to 34% in 2023 (Chart 2.5). It fell back to 29% in 2024, but this remained above the rate of around 25% in the years leading up to the pandemic. Scotland has legislated targets to reduce the fuel poverty rate to no more than five per cent by 2040.[7] A household is fuel poor if it would require to spend more than ten per cent of its income to pay for reasonable fuel needs, and where its remaining income is below the minimum income standard.
• Food insecurity. In 2024, 8% of adults in Scotland had worried about running out of food due to a lack of money or other resources in the last 12 months, a decrease from 14% in 2023 and a return to the range recorded between 2017 and 2021. Six percent of adults reported eating less in the last 12 months due to a lack of money or other resources; 3% had run out for food in the previous 12 months due to a lack of money or resources.
• Water poverty. Whilst consumers in Scotland benefit from lower water bills on average than consumers in England and Wales, around ten per cent of households in Scotland are projected to be in water poverty in 2026/27. This is in line with the rate seen over the past decade, but is projected to increase in future years if water charges continue to increase above the rate of inflation.[8] A household is said to be in water poverty if it spends more than 3 per cent of its disposable income on water charges.

One of the implications of rising real prices has been an increase in consumer debt in relation to essential utilities. At a UK level, domestic energy debt has been on a rising trend since 2022, reaching £4.79bn in 2026[9]. Almost one in five consumers in Scotland were in energy debt or arrears in early 2026 (Chart 2.6).[10] Being in energy debt has negative impacts on health and wellbeing for indebted consumers – and since the debt is ultimately socialised across all bills, it indirectly affects a wider cohort of consumers through higher bills. Spotlight 2.3 considers measures to reduce energy bills.

Indebtedness is not confined to energy bills. Rising prices relative to incomes places many households under strain. The latest Scotland report from the Money and Pensions Service shows that 15% of adults in Scotland often use a credit card, overdraft, or borrow money to buy food or pay bills because they have run short of money. The same report finds that 13% of adults in Scotland show ‘strong indicators of needing debt advice due to arrears, using high-cost credit or facing creditor action.[11]

A large proportion of households are indebted in relation to water and sewerage bills. A recent Consumer Scotland report identifies ways to reduce the likelihood of households becoming indebted, and ways to better support indebted consumers to recover.[12]

The broader picture is of a context where a large number of consumers have low financial resilience. The Financial Conduct Authority estimates that 23% of adults in Scotland had low financial resilience in 2024 – defined as having either low savings (not able to withstand losing their main source of household income for even one week), being in financial difficulty (failed to pay domestic bills or meet credit commitments in three or more of the last six months), or being heavily burdened by their domestic bills or credit commitments). The proportion of adults in Scotland with low financial resilience had declined marginally between 2022 and 2024, and is broadly on a par with the UK as a whole (24%).

How can policy respond to cost of living challenges?

Affordability issues are as much about incomes and the distribution of those incomes as they are about the costs of particular goods and services. For a consumer advocacy body like Consumer Scotland, the focus is on identifying opportunities to reduce the costs of particular goods and services, or the way in which those costs affect particular groups of consumer.

Many of these opportunities – indeed most of them – do not apply specifically during ‘crisis’ periods. Making sure that markets operate to deliver fair and affordable prices in ‘normal’ times is a critical part of ensuring that consumers are protected from more rapid price increases observed during a cost of living crisis.

In broad terms there are a number of ways that consumer policy can seek to mitigate cost of living pressures on consumers generally or on particular groups of consumers specifically:

• Ensuring that overall costs are efficient, fair and competitive. Consumers are well served when the prices they pay are a fair reflection of the costs of providing that service, and investing to maintain the provision of that service in future. This is partly about ensuring that markets, nationally and locally, operate competitively. But it’s also about ensuring that market structures and the way different costs are allocated is fair.
• Ensuring that costs are allocated fairly across different groups of consumers. In several markets for essential services, including energy, water and telecoms, discounts or reductions are provided to some groups of consumers, funded through redistribution from other consumers’ bills. The level of discount provided, to whom (i.e. how it is targeted), and the implications for the consumers who cross-subsidise the discounts matters critically for fairness – and for how well consumers are served by these policies. It is also important to ensure that costs are allocated fairly over time. Infrastructure-based markets such as energy, water, and transport can involve substantial fixed costs and provide benefits over many years. Decisions around how these costs are recovered affect how they are distributed between current and future consumers.
• Supporting consumers to access the prices, tariffs or deals that best suit their particular needs. In some markets, a wide range of tariffs are available, and the difference in consumer bills can be substantial depending on whether or not they are on the tariff that best meets their needs. Availability of appropriate information, advice and support is critical to ensure consumers have the confidence and knowledge to access the products that best meet their needs and resources. The onus for this must not rest on consumers alone - suppliers should be proactively offering consumers the products that best meets the consumers, not the suppliers, needs.
• Using regulation to protect consumers from price volatility, inefficiency and the risk of excess profits. Regulation can be used to cap the rate of price increase for a given service (as per the energy price cap), or to determine the degree of transparency that consumers receive in relation to future price increases (such as regulations governing the information that consumers should receive in relation to future ‘mid-contract’ price rises on their mobile contract).

The following three Spotlights illustrate more specifically some of the priorities for policy in enhancing the affordability of essential services.

• The first (Spotlight 2.2) examines how better targeting of affordability policy in a range of markets can help ensure more effectively and efficiently reaches the consumers who most need it. This often relies on better use of data to target and automate affordability support.
• The second (Spotlight 2.3) considers a range of options for improving the affordability of household energy bills more specifically. Energy is a market where policy can have significant impact on pricing and billing, hence the grounds for focussing on it in detail.
• The third (Spotlight 2.4) considers challenges in protecting heat networks consumers from high and volatile bills. Whilst this is a much more niche issue than the issues covered by the other two spotlights, it serves to illustrate the challenges in adapting to the issues created by new or emerging technologies.

The Spotlights are not intended to be comprehensive of all markets in which affordability issues arise, or all areas in which policy can intervene. One area not explicitly covered in the Spotlights is food insecurity. Food insecurity is particularly concerning given its direct impacts on wellbeing – and with around a quarter of a million households in Scotland being unable to feed themselves adequately.[13]

Food insecurity arises in part because it is one of the categories of expenditure over which households have discretion over in the very short term – as a result it is often one of the first areas of expenditure that households cut back on when their budgets are constrained. It is for these reasons that a ‘cash first’ approach to food insecurity – as adopted by the Scottish Government since 2023 – is appropriate as it addresses the fundamental cause of food insecurity – low income.

Spotlight 2.2: Ensuring affordability support reaches the people who need it

Too many households in Scotland cannot afford essential services like water, energy and telecoms — even though affordability schemes exist. In markets for these essential products, a variety of affordability policies exist to provide bill discounts or reductions to groups of consumers who are most likely to face challenges in affording their bills for these services.

These policies are critical. Without them, low‑income households are often forced to choose between cutting back on essential services or falling into debt — with consequences for health and wellbeing. However, affordability support is not nearly as effective is it should be because it is poorly targeted and poorly automated.

• In water for example, our analysis shows that fewer than half of households in water poverty receive the Water Charges Reduction Scheme, through a combination of under-claiming and ineligibility.[14]
• In energy, fewer than half of ‘fuel poor’ households in Scotland receive the Warm Home Discount (WHD); and of those that do receive WHD, around one third are not fuel poor.[15]
• In telecoms, fewer than ten per cent of households eligible for support take it up, often reflecting low awareness of non-automated support schemes.[16]

Fixing affordability support is not primarily a question of spending more money — it is about designing existing support far more effectively.

Improving the targeting of affordability support starts by recognising the challenges that impede better targeting. One barrier is the availability and quality of data needed to identify households in genuine need. Information on income, health conditions, energy use or housing quality is often fragmented, incomplete, or held by different organisations.

But data availability is only part of the problem. A second challenge is around data sharing – in other words, getting the data from an organisation that holds it to a billing organisation.

Some good examples of data sharing do exist, often at a local level. Governments, including the Scottish Government, have a role to play in supporting and encouraging further innovation and piloting to help demonstrate what is practical and achievable. A short-term priority in Scotland should be the more consistent use of DWP data by local authorities to automatically enrol eligible households onto the Water Charges Reduction Scheme, rather than relying on claimants to make the claim themselves. And, it would be possible to automate payments to low-income heating-oil consumers, rather than requiring them to find out about, and apply proactively for, support when that is made available.

Ultimately, the inability to target – and automate – affordability support more effectively means that consumers are not well served. Some consumers experience unnecessary harm because they do not receive adequate support – such as self-rationing or problem debt - whilst others face higher overall bills because affordability support, which tends to be cross-funded across all billpayers, is provided to some who don’t need it.

Spotlight 2.3: Enhancing the affordability of energy bills

The energy market stands out as one where there is in principle scope to reduce consumer harms from high bills. Persistently high energy bills are worsening health outcomes and increasing household debt. Consumer Scotland’s latest energy affordability tracker shows that, whilst the perceived affordability of energy bills has improved considerably since 2022, over a third of households in Scotland cannot afford to heat their home to a comfortable level, and significant numbers think that their mental or physical health is negatively impacted by trying to keep up with energy bills.[17] High energy bills are also a major cause of detriment to small businesses in Scotland.[18]

UK electricity prices remain amongst the highest in comparator countries, and it is generally accepted that energy bills are unlikely to fall to their pre-2022 levels for the foreseeable future.[19] Wholesale gas prices are forecast to remain high given global macroeconomic events. And whilst more renewable electricity is coming on stream, the costs associated with transmitting this electricity across the country, and responding to its intermittency – mean that consumer bills are unlikely to fall in the short-term.[20]

In this context it is critical to take a holistic approach to protecting consumers – and vulnerable consumers in particular – from persistently high prices. Appropriate policy responses include:

• More effective targeting of energy bill support. Current energy affordability interventions – including a mix of (mainly) UK government and (partly) Scottish government policies – provide relatively shallow support that is bluntly targeted. Developing enhanced approaches that more effectively allocate affordability support – which is ultimately cross-subsidised by consumers generally – is a policy imperative.
• Enhancing consumers’ capacity to adopt low-carbon technologies and improve the energy efficiency of their homes. Enhancing energy efficiency is a key way to reduce energy bills. But consumers need greater support to navigate complex energy efficiency markets, and greater protections from substandard installation.[21]
• Helping consumers capitalise on tariff opportunities. There are growing opportunities for consumers to reduce bills by taking advantage of various Time-of-Use tariffs, which charge lower rates at off-peak times. Whether these tariffs are right for consumers will depend on their capacity to use energy off-peak, which in turn depends on consumers’ lifestyles and their appliances. Consumers need support to navigate these choices, and to be able to adopt the necessary technologies.

Spotlight 2.4: Protecting heat networks consumers from price volatility

A heat network, also known as communal or district heating, is a type of heating and hot water system that distributes heat from a central source to multiple properties. They replace the need for individual heating systems such as gas boilers and can utilise low carbon heat sources. Heat networks are natural monopolies, meaning that people who live on a heat network usually cannot switch to a different provider or heating type. Consumers therefore need strong protections to make sure that heat networks are reliable and affordable.

Heat networks currently supply heating and hot water to about 1% of Scotland’s homes (about 30,000 homes).[22] However, this is expected to grow over the next two decades. The Scottish Government identifies heat networks as a vital technology in the transition to net zero.[23]

Consumers on heat networks are not protected by a price cap like gas and electricity consumers have been since 2019. Although heat networks are expected to play an important role in the transition to net zero, most existing networks are still run on gas. One data source suggests that around 85% of heat networks notified by the end of December 2025 reported natural gas as their primary energy source, among those for which a primary energy source was recorded.[24]  Where this is procured on commercial markets, gas price volatility is ultimately passed through to consumers’ bills. In addition to having to cover these costs, heat networks also need to undertake ongoing maintenance and upgrade work, comply with forthcoming technical standards, and begin the switch to low carbon fuel sources.

In January 2026, new consumer protections were introduced as part of heat network regulation. These protections include principles to promote pricing practices which are fair and not disproportionate. However, they do not prevent heat networks from passing on costs to consumers if they are properly communicated and reflective of the true cost. This means that under current regulation, consumers will not be protected from the high costs of complying with new technical standards and decarbonisation.

Consumer Scotland has recommended[25] that Scottish Government put in place equivalent support to the heat network efficiency scheme (HNES)[26] already available in England and Wales. This support will help to improve efficiency, reduce emissions, improve infrastructure challenges and support decarbonisation.

Positive consumer outcomes – both existing and in the future – are key to the sector’s success, and its ability to contribute to the decarbonisation of Scotland’s built environment.

The accessibility of goods and services

People’s access to goods and services is not only constrained by affordability. It can also be constrained by limited availability of a service; or, by people’s limited skills or capacity to engage with a product.

This section focuses largely on the specific impacts of digitalisation, and the risks this poses to digitally excluded consumers. But it is important to highlight that access can be constrained for reasons other than technological change. For example, Box 2.5 highlights how issues around women’s safety can affect how they access transport and postal services. As another example, some groups of consumers – including disabled consumers and small business consumers – are not always able to access parcel delivery services effectively. [27]

Spotlight 2.5: Women’s safety in consumer markets: a gendered perspective

Women’s experience as consumers can differ from men’s. As highlighted by UN Trade and Development (UNCTAD), these gender-based issues can include unfair marketing practices, misleading advertising, hazardous products and gender-based price differences.[28]

Personal safety concerns in particular shape women’s experience as consumers, and how they access essential services.

For example, Transport Scotland research evidenced a range of concerns which impacted women and girls’ feelings of personal safety when using public transport, including antisocial behaviour, harassment (sexual and otherwise), verbal abuse, physical assault, and being followed by strangers.[29] For some women this meant no longer using public transport and switching to private transport which both increased costs and was not necessarily safer.[30]

Fears of personal safety are not limited to public spaces. Consumer Scotland, building on work done by Citizens Advice, found that victim/survivors of domestic abuse in Scotland (81% of whom were women) were more likely to experience postal exclusion.[31] To recover post sent to their previous address, women could potentially put their safety in jeopardy to access health letters, legal summons, or benefits decisions.[32] This means women can miss these vital pieces of correspondence, leading to further detriment and harm, such as missed appointments, fines, or disruptions to social security.

Women are entitled to access consumer markets safely. A lack of a cross-market approach means that women’s safety is not treated holistically from a research or policy perspective. More needs to be done to understand how women’s personal safety impacts their access to consumer markets, and what policies can be introduced to tackle issues facing women.

How many consumers are digitally excluded?

Our lives are increasingly dependent on being able to access good quality internet services to engage with a range of products and services, including public services. People’s ability to access services on the internet depends both on the availability of decent internet services, as well as their capacity to use those services.

In Scotland, as in the rest of the UK, the pace of roll-out of fixed and mobile internet services has, by many measures, been remarkable. But telecoms coverage is geographically patchy.

In Scotland, 89% of consumers in urban areas have access to gigabit-capable broadband, but this falls to only 54% of rural consumers.[33] Superfast broadband is available to 99% of urban premises, but 88% of rural premises.

In terms of mobile coverage, Scotland has the lowest 4G geographical coverage of all four nations of the UK, with only 71% of its landmass area having coverage from all providers.[34] Scotland also suffers from the highest incidence of 4G total not-spots (landmass areas which do not receive mobile telephone coverage from any operator). Scotland’s landmass is 9% 4G not-spots, as compared with a UK average of 4%.[35] Scotland also has the lowest 5G geographic coverage range of all four UK nations.[36]

There is also an access gap, with households in the most deprived quintile of neighbourhoods 9 pp less likely to be connected than those in the least deprived quintile (Chart 2.7).

Consumer voice on internet access

“My son will be watching YouTube, if he’s watching YouTube, we can’t do anything … So, if I want to download anything it’s generally once everybody goes to sleep.” - Low-income consumer, rural area, 47[37]

Addressing these ongoing gaps in access must remain a focus of investment programmes, such as the Scottish Government’s R100. [38] The forthcoming review of the Broadband Universal Service Obligation (USO), due to commence in 2026, should also act as a catalyst to improve the connectivity of consumers across the UK; it should increase the speeds specified in the USO, and recognise the potential of new technologies to address connectivity gaps in hard-to-reach areas.

As well as the availability of internet services, people’s access to internet can also be constrained by their own skills and confidence in using it. Digital exclusion affects consumers who are unable to afford an appropriate device or internet connection, who do not have the skills and confidence to use digital technology, or who have a fear or mistrust of using online services or lack the motivation to do it.[39]

15%, or approximately 1 in 6 adults in Scotland lack the digital “foundational skills” to do things such as turn on a digital device, connect to the internet, use an internet-browser, or update a password.[40] There is a strong association between digital exclusion, poverty and people with certain protected characteristics including age.[41]

Financial access and exclusion

Digital access matters not just on its own right, but because digital channels have become the default means of access for many other services. Digitalisation is affecting the way consumers access goods and services in multiple markets, including public services and physical goods. Whilst providing many opportunities to consumers, digitalisation also poses some risks.

In the used-car market for example, technological change has enabled consumers to increasingly purchase at distance – potentially opening up greater choice and strengthening competition – but also increasing risks to consumers from incomplete information at the point of sale, and greater difficulties in securing redress.[42]

The following chapter examines risks associated with misleading pricing or information in a digital world. Here, we focus on the more foundational risk of exclusion as a result of digitalisation.

A key measure of digital exclusion from financial services is the share of adults with a current account who do not use online or mobile banking. On this measure, substantial progress has been made: the share of banked adults who are digitally excluded has fallen from 22% in 2017 to 7% in 2024 across the UK as a whole (Chart 2.8). Scotland has seen a comparable improvement over the same period, falling from 29% in 2017 to 9% in 2024, though its rate remains higher than in England at 6% and Wales at 5%.

However, the overall trend conceals important variation. Exclusion is concentrated among older adults, with 17% of those aged 75 and over remaining without access to online or mobile banking, almost double the rate for those aged 65 to 74 (9%) and between three and five times the rate for those aged 25 to 54, where exclusion is just 3% to 4%.

Those on the lowest incomes (under £15,000 per year) are excluded at a rate of 15%, against close to zero for those earning between £75,000 and £100,000.

Furthermore, as bank branches continue to close, consumers have had to find alternative ways to access banking services. In 2024 alone, 18% of banked adults across the UK and 15% in Scotland lost a branch they regularly used over the previous year. The majority of those who lost a regularly-used bank branch responded by banking more digitally (64%), 18% visited their local Post Office as a direct result, whilst 14% found no alternative at all.

Financial exclusion is also more likely to affect consumers from minority ethnic groups.[43] And, the issues of digital and financial access more generally – with their knock-on impacts for access in other markets – are particularly prevalent in rural areas of Scotland, as set-out in Spotlight 2.6.

Spotlight 2.6: Accessibility in rural areas

The distinctive nature of Scotland’s geography can accentuate access issues in rural areas, particularly those in rural and island communities.

As noted in the main body of the report, internet services are generally of lower quality in Scotland’s rural areas, with lower coverage of faster speed connections. Just over half of rural consumers have access to gigabit-capable broadband, while superfast broadband is available to 88% of rural premises compared with 99% of urban premises.

But accessibility challenges in rural areas are not limited to digital services. Postal services are a critical economic lifeline for Scotland’s rural and island communities, yet fragile delivery systems, high surcharges and inconsistent services are placing growing pressure on small businesses and local economies. Consumer Scotland research found that small business consumers in island communities reported difficulties receiving essential materials on time, reputational risks linked to slow or inconsistent deliveries and additional effort required to track or resolve missing items.[44] Transport services – particularly rural bus services – can also limit access to wider employment and leisure opportunities, particularly for disabled consumers and others with limited mobility.[45]

Scotland’s rural areas are frequently placed at a greater disadvantage when technology changes more generally, either when new technologies are rolled out, or existing technologies become obsolete. For example:

• Smart meters automatically transmit gas and electricity readings for domestic and non‑domestic consumers, reducing reliance on estimated billing and protecting consumers from back‑billing and price volatility. They support improved budgeting through real‑time usage information and enable access to flexible tariffs and emerging smart technologies. The smart meter rollout in Scotland has been slower and patchier than in other parts of GB, where the current target is to achieve an 85% smart meter penetration rate by 2030. The latest regional penetration rate figures for Scotland sit at 71%, somewhat lower than the GB average of 74%.[46] But in rural areas the penetration ranges from 66% (Dumfries and Galloway), to as low as 56% (Orkney). There have been a number of historical, technical, and structural barriers to uptake in Scotland, including limited engineering capacity and weak supplier incentives to prioritise remote and sparsely populated areas.[47]
• The planned switch-off of the Public Switched Telephone Network (PSTN) which is due to be switched off by the end of January 2027 - with consumers migrated to Voice Over Internet Protocol (VoIP) technology[48] - exposes some consumers to risk of serious harm due to their telecare devices being disconnected during the migration. Consumer Scotland analysis has found that a significant minority of consumers are potentially vulnerable as a result of the migration, with those in rural areas at a particular risk, due to the combination of more frequent and longer lasting power cuts and poorer mobile coverage and performance.[49] As VOIP services will not work without power, additional back up measures may be needed to ensure the safety of consumers in vulnerable circumstances.
• Access to cash is becoming increasingly difficult for the 6%, or 300,000, consumers in Scotland who rely on it. The distinctive nature of Scotland’s geography can mean that branch closures, and the associated reduction of access to cash and physical banking facilities, can have particular impacts on rural and island communities.

These examples are symptomatic of the more challenging issues associated with accessing essential goods and services in Scotland’s rural areas.

Spotlight 3.1: Ethnic minorities and consumer harm

Race and ethnicity are frequently associated with different consumer outcomes, with some ethnic groups consistently experiencing greater harms.

For example, the CMA’s Consumer Detriment Study shows that consumers with a Black (84%) or mixed (86%) background were significantly more likely to experience detriment than those with a white British (71%) or Asian (70%) background.

Moreover, consumers with an ethnic minority background were substantially more likely to experience detriment with ‘very negative’ mental health consequences compared to those with a white background (17% and 11% respectively). Consumers from Black, Asian, Mixed or other minority ethnic backgrounds were also more likely to have stated the complaint process was not clear (16% compared with 7% of consumers from any White background). [53] 

Consumers with an ethnic minority background are also more likely to report having ever experienced a product safety issue (40%, compared with 27% for White adults).[54] And research in England shows that ethnic minority tenants are more likely than White British tenants to face eviction or court orders.[55]

In this report, we look at consumer harm through framework of vulnerability. This approach argues that characteristics like low financial resilience, poor health, and low capability are indicators of vulnerability.

Part of the reason why ethnic minorities are at greater risk of experiencing harm is that they are more likely to be in vulnerable circumstances – more likely to have low financial resilience, poor health, etc.

But this is not the only reason. There is some evidence that ethnic minority groups experience greater harm than would be predicted by their vulnerability characteristics alone. This additional risk of harm reflects the effect of discrimination (notwithstanding the fact that ethnic groups’ lower income and poorer health might itself be in part the result of discrimination).

The extent to which the poorer outcomes experienced by ethnic minorities on average reflect discrimination rather than other underlying characteristics is difficult to assess. Regardless of the reasons, the fact that ethnic minorities consistently experience greater harm and poorer experiences is a significant concern. It reflects deep-rooted bias, and indicates that ethnic minority consumers are less well served on average than White British consumers.

Which consumers are most likely to experience unsafe products?

Harm from unsafe products is a more specific, but particularly significant, source of consumer detriment. Unsafe products can in the most severe cases lead to serious injury, fires and deaths, but can also cause more minor injuries and undermine consumers’ confidence to engage in markets.

Recent cases illustrate the potential severity of harm when unsafe products do enter the market. Defective white goods and electrical chargers have been linked to domestic fires; unsafe toys and childcare products have caused choking and injury; and poorly designed lithium‑ion batteries have been associated with serious burns and explosions.[56]

Fortunately, the most severe harms occur infrequently. However, product safety issues are far from rare. According to the Office for Product Safety and Standards (OPSS), 29% of adults across the UK have experienced a product safety issue.[57] When people experience product safety issues, the impacts are often significant. A quarter report physical harm, while around 30% report distress.

Consumer Scotland’s Consumer Welfare Survey asked respondents whether they had experienced a consumer safety issue during the past 12 months (unlike the OPSS survey which does not specify a time-frame). On this narrower basis, one in seven respondents (14%) to our survey said they had experienced a product safety issue in the last year.

Consistent with OPSS findings, the Consumer Welfare Survey also revealed a strong age-gradient, with younger consumers substantially more likely to report having experienced a product safety issue compared to older consumers (Chart 3.2). There might be a compositional explanation for this – e.g. that younger consumers are more likely to buy products in sectors that are most associated with safety issues, notably electrical products, household appliances, and toys. However, sample size limits the ability to test this hypothesis conclusively.

The Consumer Welfare Survey also revealed that those with higher incomes were more likely to have experienced a product safety issue than those with lower incomes. This may reflect that higher income households are more likely to make purchases in sectors that are associated with the highest prevalence of safety issues – notably household appliances and electrical goods. There was no statistically significant relationship between vulnerability characteristics and experience of product safety issues.

The product category people are most likely to experience safety issues in – in both our Consumer Welfare Survey and OPSS research - is electrical appliances. Consumer Scotland’s Consumer Welfare Survey found that among those who had purchased a product posing a safety risk in the past 12 months, 45% related to an electrical safety risk. Research suggests that the average consumer harm associated with an unsafe electrical product is £145.[58] This does not include mental health issues and excludes the most severe harms.

An important development in recent years has been the establishment of a UK wide public database of recalled goods. The Consumer Scotland Act 2020 placed Consumer Scotland under a duty to establish, or secure the establishment, of a publicly available database of recall of goods in Scotland. Since that date OPSS introduced in 2022 an UK-wide public database of recalled goods. Consumer Scotland now works in partnership with OPSS to ensure consumers in Scotland can access the database, share safety alerts and raise awareness of safety issues. 

However, protecting consumers from unsafe products is becoming more complex due to rapid technological change and increasingly globalised supply chains.[59] This is a critical time to update the UK’s Product Safety Framework for the modern age, ensure it is fit for the future, and better meets the needs of consumers in Scotland and across the UK.

Spotlight 3.2 sets out how the UK is attempting to respond to these challenges through recently passed enabling legislation.

Spotlight 3.2: Protecting consumers from unsafe products

‘The existing product safety framework has been stretched to its limit by increasingly globalised supply chains and the ever-changing way in which consumers buy products.’ Kate Dearden, Minister for Employment Rights and Consumer Protection, April 2026[60]

Reasons why technological change and increasingly globalised supply chains can pose challenges for consumer protection include[61]:

• Globalised supply-chains can be challenging to monitor and enforce. The growth of online marketplaces has fundamentally changed how consumers buy products, often blurring responsibility for safety. Online platforms – such as Amazon Marketplace, Temu, Shein and others – can supply goods directly to UK consumers from third party sellers, making it difficult to identify who is responsible for ensuring a product is safe, or who should act when something goes wrong.
• Smart devices and connected products are complex, are evolving rapidly, and can receive software updates which materially change product risk after sale.

The heightened risks associated with buying online are reflected in consumer attitudes. Most consumers (71%) agree that products sold in the UK are generally safe given the regulatory framework in place.[62] But only 37% of consumers agree that products sold online are generally safe as a result of the regulatory framework.

The UK has taken an important step towards updating its product safety framework by modernising its legislative framework. The Product Regulation and Metrology Act 2025 provides enabling powers designed to update product safety rules, align them with new technologies, and clarify responsibilities across supply chains.

The Act in principle provides government greater flexibility to respond to emerging product safety risks through a broad, risk-based definition of product safety. It brings online platforms within the product safety regime, giving the government powers to impose legal obligations on the operators of online marketplaces, importers and distributors.

In itself however, the Act does not guarantee safer products, nor provide any immediate protections for consumers. Its effectiveness will depend on how it is implemented through secondary legislation, and how well the regime is enforced in practice. The UK government consulted on a new product safety framework in 2026.[63]

Can consumers recognise unclear or misleading information?

Consumers can be exposed to misleading information across many areas, such as misleading prices, misleading product information or misleading claims.

Asked whether or not they agreed with the statement ‘I feel confident I can recognise misleading or unclear information about items or services’, 73% of respondents either agreed or agreed strongly. Only 5% disagreed.

There was a less obvious age gradient in the responses to this question (Chart 3.3). However, what is striking is how much less likely respondents were to agree if they are not confident in using the internet. Only 40% of respondents who are not confident in using the internet felt that they could recognise misleading information. This is another illustration of the foundational importance of digital services in enabling access to other markets.

Asked about their experiences of shopping online, a majority of consumers who had shopped online had experienced various harmful practices in the past 12 months (Chart 3.4). Over two-thirds had experienced forms of drip-pricing or misleading product information. Difficulties unsubscribing from services and contacting traders about issues were also common. There was a strong age gradient for all these responses, with younger consumers more likely to experience the detriment often or more frequently, compared to older age groups.

Misleading pricing is a particularly pervasive form of misleading information. Consumers need to know the price they are paying for a product – and how that compares to the price of similar products. Misleading pricing disadvantages consumers by resulting in them spending more. It can also undermine consumers’ confidence and trust in markets, and impede competition –negatively impacting economic competitiveness.

Spotlight 3.3 describes some of the circumstances under which misleading pricing can arise, from misleading pricing in physical shops to practices that have been enabled through online platforms.

Spotlight 3.3: Protecting consumers from misleading pricing practices

Clear and transparent pricing is a fundamental component of a well-functioning consumer market that serves consumers’ needs.

Most bricks and mortar retailers in Scotland understand pricing law and provide pricing transparency most of the time. But examples of wrongly or misleadingly priced products are not difficult to find. In 2023, over 4% of goods were not priced at all in national chains and 6.5% of products had incorrect unit pricing.[64] In addition, 3.7% of products were wrongly charged at the checkout, mostly to the detriment to the customer. Instances of incorrect prices in small and medium retailers were substantially higher. Misleading ‘reference pricing’ – regarding recommended retail prices (RRPs), or claimed savings against a previous or competitors price – is not uncommon.[65]

When it comes to buying goods and services online, the challenges for consumers in ascertaining the price they are paying and how fair that price is are being accentuated by practices such as ‘drip pricing’ ,‘dynamic pricing’ and ‘personalised pricing’.

Drip pricing occurs when consumers are shown an initial price for a good/service while additional fees are revealed (or “dripped”) later in the checkout process. It has been a prevalent practice,[66] but following the DMCCA 2024 is now a banned practice in some circumstances.

Dynamic pricing involves frequent adjustments to price in response to changes in demand and supply.[67] It has become an increasingly prevalent practice in some markets, notably events and travel, enabled in part through technologies which enable prices to vary in almost real time in response to demand and supply fluctuations.[68]

Whilst dynamic pricing enables prices to move frequently in time, personalised pricing – sometimes also referred to as surveillance or algorithmic pricing – occurs when businesses offer the same product at different prices to different consumers or groups of consumers.

Technological advancements in data collection, storage and processing is now enabling a growing number of businesses to introduce forms of ‘personalised’ pricing.[69] In some sectors, use of personalised pricing is widespread – over 50% of businesses in retail and accommodation services reported using some form of personalised pricing.[70] As a result, consumers now sometimes see prices, or price promotions, that are specific or tailored to them in some way.

Neither dynamic nor personalised pricing are unlawful (as long as the final price – or potential final price – is communicated in a transparent and timely manner) but the practices can undermine transparency, and trust, making it much more difficult for consumers to understand whether or not the price they are quoted is ‘fair’, as there is no reference on which they can judge that.

Protecting consumers from the harms of misleading pricing is likely to require action on multiple fronts, recognising the many channels through which consumers buy goods, and the range of pricing practices used by traders. These actions might include:

• Strengthen enforcement capacity. Clamping down on misleading pricing – missing or incorrect prices – in physical retailers has been hampered by a lack of surveillance capacity and constrained enforcement resources within local trading standards services (discussed further below).
• Use new DMCCA powers robustly. Following the Digital Markets, Competition and Consumers Act 2025, drip pricing is now a banned practice where it involves mandatory charges that are not included in the upfront total price. But it is still happening. The CMA has been investigating a number of businesses for undertaking banned drip pricing, and took its first enforcement action against banned practices in April 2026.[71] This action is welcome, but the CMA and other consumer bodies will need to remain vigilant to further cases, and be prepared to take swift enforcement action.
• Proactively investigate personalised pricing. The CMA and other regulators should monitor closely the evolving use of personalised pricing, and its impacts on consumers. This may require the CMA to use its legislative powers to develop a robust picture of the prevalence of the practice, similar to the work of the Federal Trade Commission in the US.[72]

How confident are consumers at recognising scams?

Alongside recognising misleading or unclear information, consumers’ confidence in recognising scams is important to ensuring that they can navigate markets safely and avoid harm.

Scams are many and varied. They frequently prey on consumers by masquerading as a service provider or supplier and asking consumers to make payments or provide personal information in that context.

In our Consumer Welfare Survey, around three-quarters (73%) of respondents agreed with the statement “I am confident that I can recognise scams”. Confidence was lower among older consumers, women, those on lower incomes, and those living in rural areas. The strongest differences, however, were observed among consumers with low digital confidence and those whose disability limited their day-to-day activities a lot. Less than half (46%) of those not confident using the internet agreed that they could recognise scams, while only 62% of those whose disability limited them a lot agreed.

The profile of consumers who lacked confidence in recognising scams closely resembled that observed for recognising misleading or unclear information, underscoring in particular the important role that digital confidence plays in identifying and responding to potential risks when engaging with markets.

How frequently do consumers fall victim to scams?

One in ten adults in Scotland have fallen victim to a scam during the past 12 months, according to Consumer Scotland’s Consumer Welfare Survey. Having a low income, having a disability which limits activity a lot, and having relatively lower financial resilience are all associated with a higher likelihood of having fallen victim to a scam (Chart 3.5).

Of those who had fallen victim to a scam, two-thirds (65%) lost money as a result. Those with at least one vulnerability characteristic were more likely (75%) than those without any vulnerability characteristic (55%) to lose money as a result of the scam. 91% of those with a disability that limits them a lot lost money as a result. In other words, consumers in vulnerable circumstances were both more likely to fall victim to a scam, and more likely to lose money as a result of the scam.

Of those who lost money as a result of the scam, approximately one third lost less than £100, one third lost between £100 and £500, and one third lost more than £500. The findings imply that 6% of Scottish adults lost money as a result of falling victim to a scam, and 2% of adults in Scotland lost more than £500 as a result of a scam. This is a significant amount of harm.

Previous work has indicated that scams activity is increasing, often enabled by growing use of online platforms for communication.[73] This means that scams can often work across borders, representing a low-cost and low-risk activity for scammers, with the potential of substantial returns.

While online platforms are often an enabler of scams, they are also increasingly an important source of information about scams for the general public. The Truth about Youth Survey is targeted at young Scots aged between 11 and 25. It shows that the youngest people in Scotland get information about scams from online channels more than from any other source. Of the top five channels where young people obtained information about scams, three were online – AI Tools (51% and the number one channel), TikTok (39%) and Other Social Media (32%). This shows the importance of using the same channels to inform consumers about scams as are used by scammers to target them.

Tackling scams must inevitably rely significantly on raising awareness amongst consumers of how to protect themselves against scams, given the challenges of disrupting scams behaviour. It may be effective to make use of the same channels from which scams are perpetrated for awareness raising. But it is also critical to make it easy for consumers to report scams, and to enhance the way that intelligence about scams is recorded and shared – to maximise awareness of emergent scams and the preventative actions that consumers can take.

How can policy help to protect consumers from harm?

The preceding analysis has shown that consumer harm is experienced by a majority of consumers, with a smaller minority experiencing some form of severe harm – such as personal injury or significant financial loss. It is clear that there is scope to improve the way that consumers are served via a robust, adaptable consumer protection framework.

At its broadest, a good consumer protection framework encompasses rights that consumers understand and trust, accessible sources of reliable information and advice, an enforceable regulatory framework to protect consumers from particular practices or harms in specific markets, and accessible sources of redress for consumers to put right problems which go wrong.

The following chapter examines key issues around consumers’ knowledge of their broad consumer rights, and access to information and advice.

The regulatory toolkit available to policy-makers is diverse, ranging from statutory rules on authorisation, standards or requirements through to voluntary codes and accreditations or guidance. The regulatory toolkit, which both the UK and Scottish governments have responsibility for depending on context, can encompass regulations which, for example:

• Authorise who can operate or provide certain services in a sector. The nature of these authorisation regimes themselves varies significantly depending on market and context, ranging from specific forms of authorisation, frequent in financial services, to more general forms of authorisation. The recently passed Non-surgical Procedures and Functions of Medical Reviewers (Scotland) Act 2025 provides the government with the ability to specify where and by who certain procedures are carried out. As another example, the Scottish licencing regime regulates who can operate in the used-car sector in Scotland – and there is scope to enhance how this licensing regime serves consumers best interests.[74]
• Ban particular practices in certain contexts. The recently passed Digital Markets, Competition and Consumers Act 2024 bans practices such as fake reviews and misleading drip-pricing, and provides powers to add further practices to the banned list.
• Set rules about information or disclosures that must be provided to consumers. For example, the DMCCA 2024 clarifies the information that must be provided to consumers as part of auto-renewing subscription charges.
• Set minimum quality and safety standards for products. A key challenge here for regulation is to provide sufficient specificity to adequately protect consumers from harms, whilst also having the flexibility to address new and emergent risks. (see Spotlight 3.2 on product safety).

With all of these regulatory issues, there is generally a question for policy makers as to whether to regulate practices very specifically, or to encourage appropriate behaviours through mechanisms such as codes of practice or accreditation schemes – which themselves can be voluntary or mandatory. And it should be remembered that regulation itself is not the only possible mechanism for protecting consumers from harm – sometimes for example, ensuring the conditions for effective competition can help ensure that consumer interests are served (Spotlight 3.4).

The question of how to best regulate to protect consumers from harm is therefore very context specific, depending on the severity of consumer harm, the pace of evolution of risks, and the structure of the specific market. Regulations may also need to balance consumer protection with considerations of broader market functioning – ensuring that regulation itself does not overly inhibit consumer access or choice for example. Regulation also needs to take into account issues around the enforcement of that regulation – as we discuss later.

Spotlight 3.4: The role of competition in consumer welfare

Competitive markets are an important component of consumer welfare. As noted by the CMA: ‘The pressure of competition, and the rewards of success, drive firms to keep prices low; to improve the quality of their products and services; to innovate; and to operate more efficiently. This benefits people, who get better deals; businesses, which reap the benefits of investment and innovation; and the wider economy, through higher productivity and living standards.’[75]

Competition – and the UK Competition Framework that underpins effective competition – is therefore an important cornerstone of markets that serve consumers well.

But competitive markets in themselves are not sufficient to guarantee that consumers are well served or protected from harm. As noted by the Scottish Government, even ‘competitive markets can still produce outcomes which create significant affordability challenges for households’.[76] To this we can add that competitive markets can be the source of consumer harms – not least because consumers don’t have perfect knowledge of the goods and services available, nor their rights and how to exercise them.

The message is that even where markets operate competitively, this does not negate the need in some cases to proactively protect consumers from harm, nor to support them to be able to exercise their rights. Moreover, the absence of competition in some markets – notably public services such as water – does not in itself mean consumers are not well served; instead, it requires even more careful consideration of the framework required to ensure consumers are well served in those markets.

How well protected do consumers feel?

In this context, what are consumers’ overall perceptions about how well they are protected by the existing consumer protection framework and institutions?

Consumer Scotland’s Consumer Welfare Survey shows that over three quarters (76%) of consumers say they feel ‘very well protected’ or ‘fairly well protected’ when buying items and services in the UK (Chart 3.6).

There are some significant differences between groups. In particular, those aged 18-24 are less likely to feel either very or quite well protected (62%), whilst over 90% of those aged 75 or over feel very or quite well protected. Those on low incomes, or in vulnerable circumstances as regards disability or financial resilience, tend to have a slightly lower likelihood of feeling well protected. However, whilst the differences between groups are sometimes statistically significant, they are often not very substantially different. On the whole, between 60-80% of all groups feel quite or well protected when purchasing items or services.

It is worth noting that the groups that are least likely to have experienced detriment, unsafe products, or fallen victim to a scam, are often the groups most likely to feel well protected as consumers. This might not seem surprising; it is less clear what the direction of causality is. Do people who have experienced more harm feel less well protected as a result; or, are those who feel well protected in a better position to avoid harm?

Overall, the fact that three quarters of consumers in Scotland feel either very or quite well protected is a positive finding. Moreover, only 4% of respondents to the survey said they do not feel well protected, with 17% unsure.

This might suggest that, by and large, regulation is reasonably effective, at least in consumers’ eyes. However, there can be a distinction between having rights, and being able to exercise those rights. A robust consumer protection framework hinges critically not just on rights, but how effectively those are enforced, and how effectively consumers can secure redress when things go wrong.

How effective is the enforcement landscape in protecting consumers?

Good regulation is important. But regulation has to be enforced if it is to serve consumers effectively and protect consumers from harm. In Scotland, enforcement of consumer protection is undertaken by a range of regulators, as well as by local and national trading standards services. Recent years have seen some strengthening of enforcement powers of the CMA, but against a backdrop of declining resource and capacity for local authority enforcement activity.

On the one hand, the DMCCA 2024 grants the Competition and Markets Authority powers to enforce consumer law directly, without having to take a business to court. It is too early to understand precisely how effectively these new powers are being exercised, but they should enable the regulator to take swifter action against breaches of consumer law.[77]

On the other hand, local trading standards services – delivered through 31 local authority trading standards services – have faced many years of declining investment.[78]

The work of local trading standards services is critical to protect consumers from harm and support businesses in complying with their obligations. The remit of trading standards includes a broad mix of reserved and devolved responsibilities including:

• Tackling rogue traders, consumer fraud, doorstep crime and scams;
• Protecting consumers by identifying and removing dangerous or counterfeit goods from the high street and online markets;
• Making sure consumers get what they pay for by ensuring that prices, product descriptions, and weights and measures are accurate;
• Supporting legitimate businesses by providing advice and support to help companies comply with the law;
• Protecting children and young people by tackling underage and illegal sales of tobacco or vapes.

The work of local trading standards is complemented by the work of Trading Standards Scotland, who provide national level support to local trading standard services by coordinating and enforcing cross-boundary and national casework and carrying out specialist functions of tackling illegal money lending and e-crime. TSS also delivers an intelligence gathering and analysis function.

Trading standards services are faced with a challenging picture of emerging harms alongside their more traditional activity; whilst needing to balance enforcement with preventative activity. Against a backdrop of declining resource – the local trading standards workforce has declined by 50% since 2002 – the service is extremely stretched.[79]

A report by CIPFA found that trading standards services had “experienced disproportionate cuts, with staffing levels reduced and vacancies left unfilled…trading standards teams are now at a critical point. Many are barely able, or already unable, to fulfil their statutory duties.”[80]

A UK-wide report by Which? also in 2025, argued that trading standards services are “broken,” struggling to deliver against a backdrop of declining resources and more complex issues. [81] Which? argued that “This erosion of the UK’s consumer enforcement system undermines consumer confidence, is unfair to responsible businesses and runs counter to the government’s economic growth mission.”

Addressing trading standards’ lack of capacity to address new and emerging threats to consumers – not to mention their critical work in existing markets – is an important priority for the UK and Scottish government and other stakeholders. Whilst the precise nature of any alternative models for trading standards delivery will rightly be debated, what is critical is that consumers are adequately protected from harms, and businesses are supported to take preventative action. Consumer Scotland has recently provided advice to Scottish Ministers on the future of trading standards.

Ensuring consumers can secure redress

What actions do consumers take when they experience problems?

It is one thing to have rights, but can consumers exercise those – and can they adequately seek redress when things go wrong?

Evidence from the UK-wide Consumer Detriment Study indicates that around 77% of consumers take action following a detriment experience. Coincidentally, 77% of people who reported having experienced a consumer problem in Consumer Scotland’s Consumer Welfare Survey also said they attempt to contact the supplier following a detriment incident.

Of those in the Consumer Welfare Survey who had contacted the supplier, 50% said they were satisfied with the outcome (again, this is in line with the 52% positive resolution rate in reported in the Consumer Detriment Study) – Chart 3.7. 30% were not satisfied with the outcome, whilst in 20% of cases the issue had not yet been fully resolved (in these cases, consumers were split 50:50 in terms of whether they were hopeful of a satisfactory resolution or not).

Satisfactory resolution depends on the nature of the problem and can include, but is not limited to: a full refund or partial refund, a replacement, a fix, an apology, compensation or vouchers.

Consumers in vulnerable circumstances were significantly less likely to obtain a satisfactory resolution to their issue – 35% of households with three or more indicators of vulnerability achieved a satisfactory outcome, compared to 40% for those with one indicator of vulnerability, and 56% for those with no indicator of vulnerability.

When consumers cannot obtain a satisfactory resolution to a problem with the supplier, what subsequent options do they have?

What options do consumers have when they cannot resolve issues with a supplier?

Where a complaint is unresolved, the consumer’s only option is to take their complaint to a court, tribunal or to some form of alternative dispute resolution scheme (ADR). Courts are often seen by consumers as costly, time consuming and stressful.[82] 

ADR schemes, where they exist, can include an ombudsman, or other adjudication or conciliation schemes.[83] These provide consumers and some small businesses an important alternative route to access justice.

ADR schemes are usually free to consumers, simple to use, quicker than courts and perceived as less stressful. The decision usually binds the trader but not the consumer so a dissatisfied consumer is still free to take court action if that is an option. 

Ombudsman schemes in the private sector use a fair and reasonable test (or a maladministration test in the public sector) and this means they can take into account a broader range of circumstances than a court could. Some ombudsman schemes such as the Energy, Financial and the Communications Ombudsman are also available to micro and / or small businesses. 

While not all consumer complaints will be justified it is notable just how many complaints are ‘upheld’ by ADR bodies. Upheld essentially means that the complaint is decided fully or partially in the complainant’s favour. It is difficult to obtain Scottish specific figures since most of the consumer ADR schemes have a UK remit.[84] 

Looking at UK schemes most recently published figures the number of complaints received and the uphold rate:

• Energy Ombudsman – 93,000 accepted cases received and 70% cases upheld in 2024[85]
• Communications Ombudsman – 31,500 accepted cases and 43% upheld in 2024 [86] and
• Financial Ombudsman Service – 214,600 new complaints received and 30% of the complaints they upheld in 2025/2026[87]

Uphold rates can vary year to year for a variety of different reasons so relying on a single year figures should be treated with caution. Overall though the figures demonstrate the importance of ADR as a route to resolve a complaint.

ADR is relevant too in relation to public services. The Scottish Public Services Ombudsman received 6,588 complaints in 2025/2026. [88] Of the 163 complaints that proceeded to a full SPSO investigation they fully or partially upheld 81% of these complaints. The 6,588 complaints received in 2025/26 marked a significant 51% increase on the 4,572 received in 2024/25. It is not entirely clear what was behind this increase – with some stakeholders suggesting that AI tools are enabling consumers to make complaints more easily than previously – although it is also the case that public satisfaction with local schools, health services and transport has tended to follow a declining trajectory since 2019.[89]

Ensuring the ADR landscape serves consumers’ needs

However, whilst ADR schemes are critical to ensuring that consumers’ interests are served, the ADR landscape is fragmented and complex with some significant gaps. It seems difficult to argue that consumers are currently well-served by the system ADR, and its accessibility.

Despite its importance, ADR is either not available at all in some sectors or is voluntary.[90] Businesses that account for a large proportion of issues are frequently those who choose not to participate in ADR schemes. This is particularly true of sectors where consumer detriment is particularly high, including home improvements, used cars, furniture, clothing or park homes.   Recent research from Citizens Advice (2026) highlights that consumers who used a trader who was a member of an ADR scheme were more likely to be able to resolve their complaint compared to those who used a trader who was not.[91]

In some sectors multiple schemes exist of widely varying quality, which impacts consumer confidence by creating consumer confusion.[92] Other than the Financial Ombudsman Service,[93] consumer awareness of ADR is also low particularly in those markets where ADR is voluntary and without a single ADR body.[94]

This therefore highlights important access to justice issues for consumers and includes a range of devolved and resolved issues. A number of ongoing policy developments are also likely to impact this issue which will require careful monitoring. 

Enhancing ADR standards

The Digital Markets, Competition and Consumers Act 2024 introduced important changes requiring stricter accreditation standards for ADR providers and only allowing approved ADR providers to be offered to consumers. Much of the detail is found in secondary legislation that came into force in March 2026 and it includes requirements regulating fees where they are charged. 

While the Act stops short of making consumer ADR compulsory it does state that the only person who can carry out ADR in relation to a consumer contract dispute is an “accredited” or an exempt ADR provider (Scottish Public Services Ombudsman and the Scottish Legal Complaints Commission are both named in the legislation as exempt providers).[95] While the intended purpose of this is to drive up standards and should mean that the poor quality schemes disappear, in the short term one unintended consequence of this could be the exit of some credible schemes who decide accreditation is not appropriate for them.

Expanding the reach of ADR schemes…or a narrowing of scope?

The Secretary of State for Business and Trade recently stated (April 2026) that the UK government is exploring the case for a single Consumer Ombudsman body in unregulated sectors.[96]  While previous attempts to persuade the UK government to introduce a single consumer ADR scheme in unregulated markets failed[97] this could be an important opportunity to drive forward single schemes in markets where consumer detriment is particularly high such as used cars, home improvements and park homes. It would result in a much simpler consumer journey and make it easier to promote awareness.  

However, it is concerning that the importance of having a general Consumer Ombudsman s being discussed at the same time as proposals to limit the scope of the work of the Financial Ombudsman Scheme are under consideration. [98] Under these proposals, the existing “fair and reasonable” test used in private sector ombudsman schemes would be adapted in ways that are likely to reduce consumer protection risking ‘moving it from a free, accessible and user-friendly service towards one that is rules based, inflexible and difficult to navigate’.[99]

Other activities in this area include the UK government and Ofgem taking forward proposals to strengthen the enforcement powers of the Energy Ombudsman including shortening time limits.[100]    More recently,  the government announced in August  2026 that it is working with the Furniture and Home Improvement Ombudsman to develop a system to protect people’s money during building projects with payments directly linked to key project milestones.[101]

Accessing redress through courts

Where consumer ADR is not available the only option will be the courts or in some cases a first tier tribunal. For example, private sector tenancy disputes, including disputes with a property factor, are dealt with by the Housing and Property Tribunal.  For many consumers,  accessing the courts and tribunals is a daunting and potentially expensive prospect.[102] Over a third (37%) of adults in Scotland have low levels of legal confidence.[103]  In addition, 24% of adults perceive the justice system in Scotland as being not very accessible.[104] Research for SPICE noted that a “substantial proportion of individuals with civil justice problems take no formal action, suggesting persistent unmet legal need, particularly among vulnerable groups”.[105]

In these circumstances access not only to advice services but legal aid can play a fundamental role in terms of ensuring access to justice.  However, an independent strategic review of legal aid in Scotland in 2018 identified the need for urgent reform of civil legal assistance[106]  and since then little progress has been made. [107]  In September 2025, a report by the Equalities, Human Rights and Civil Justice Committee concluded that there remained “an urgent need for action to improve the delivery of civil legal assistance” (para 176) .[108] They highlighted unmet legal need due to legal aid deserts which includes both geographical areas (particularly in some rural areas) as well as particular areas of law (such as housing and welfare law, human rights and domestic abuse).  In July 2026 the Scottish Government launched a consultation on a new Legal Aid (Scotland) Bill.[109]

The costs and benefits of mass redress

An important development in recent years has been the growth in interest in mass redress mechanisms.  These include regulators such as the FCA proposing a mass redress scheme for consumers who experienced detriment caused by a failure to disclose motor finance commission arrangements,[110] the growth in no win, no fee mass consumer claims[111] as well as the introduction of group or class actions in the court. The CMA and trading standards also have powers that enable them to require traders in some circumstances to compensate or take other action in relation to redress.

Some of the evolving issues associated with mass redress in Scotland are discussed in Spotlight 3.5. Bringing multiple claims under ‘opt out’ group proceedings can increase access to justice.  It can make redress possible where individual claims alone would be too small to be economically viable to pursue.  It can also secure redress for consumers who may not even know they have been harmed and / or would not typically take action.  However, for this potential to be realised effective consumer safeguards are required including providing assurance that compensation awards are not fully absorbed by lawyers and funders costs leaving consumers with little recompense for harm.[112]   The proposal for a redress scheme for motor finance has also been partially suspended due to several legal challenges to the scheme with an Upper Tribunal decision not likely to be before next year.[113]

Spotlight 3.5: Mass redress in Scotland

Mass redress schemes can be an important route for consumers to obtain redress, particularly where multiple consumers experience the same harm, and can be an effective accountability mechanism for businesses for their actions potentially plugging a gap left by public enforcement. However significant concerns also exist particularly in relation to the way that any litigation is funded by third parties.[114]  

Since 2015, there has been a UK-wide class action mechanism specifically for competition disputes in the Competition Appeal Tribunal (CAT). The regime allows proceedings to be brought on behalf of a group on an opt-in or an opt-out basis in appropriate circumstances. There has been a significant increase in the number and value of group damages claims. Examples of the types of consumer disputes that could fall within these requirements include claims against Mastercard (one of the first), Apple and Sony. These claims will include redress for consumers and small businesses in Scotland.

Outside of competition disputes, since 2020 similar rules have existed in Scotland for ‘opt in’  group actions.[115] Recent examples in the Scottish courts include group actions relating to losses suffered by 6,400 customers who have purchased or leased Jaguar Land Rover[116] and  8,500 customers in relation to Nissan and Renault regarding misleading diesel emissions claims.[117] 

In principle, Consumer Scotland broadly supported the proposal though we also emphasised that to be effective robust safeguards were also needed.

In England and Wales, the Department of Business and Trade recently considered the same issue.[118] The responses demonstrated a wide divergence in views and for now the UK government is not proposing to extend the opt out group actions beyond competition claims in England and Wales.[119] 

How confidently and reliably do consumers know their rights?

Understanding consumer rights is an important component of consumer confidence and empowerment, influencing consumers’ ability to make informed decisions, identify when problems have occurred, and seek appropriate support and redress when issues arise.

Our Consumer Welfare Survey found that consumers generally reported high levels of confidence in their understanding of their rights. Overall, two thirds (67%) said they were confident in their understanding, including around half (51%) who were “fairly confident”, and 16% who were “very confident”.

Consumers aged 75 and over were the most likely to report feeling confident in their understanding of their rights (75%), alongside those aged 25-34 (73%), while those aged 18-24 were the least likely to do so (60%) – Chart 4.2. Confidence also increased consistently with income, with 60% of those earning less than £20,000 per year reporting feeling confident, compared with 76% of those earning more than £60,000.

Perceived understanding also increased with confidence using the internet. Among respondents who said they were not confident using the internet, only half (50%) reported feeling confident in their understanding of consumer rights.

Understanding rights: perceptions v. reality

Consumers might feel confident in knowing their rights, but how well placed are those perceptions?

A further question in the Consumer Welfare Survey was used as a proxy measure to test consumers’ understanding of their rights in practice, by asking which offers the greatest protection: purchasing from a high street store or purchasing from the retailer’s website. Overall, responses suggested a potential misalignment between perception and understanding. Only 12% of respondents correctly answered that the retailer’s website offers the greatest protection, while around a third of all respondents (32%) answered that the physical store offers the greatest protection, and a third (33%) answered that there was no difference.[121]

Strikingly, those reporting higher confidence were least likely to select the correct answer, while those in the “not very confident” group were most likely to select the correct answer.

This suggests that self-reported confidence in consumer rights does not always align with actual understanding. This misplaced confidence is important – suggesting that consumers are more at risk of detriment or misleading practices than they might think, and indicating a greater gap in awareness and education than might be assumed from considering self-reported confidence only.

There was also a clear relationship between confidence in understanding consumer rights and perceptions of consumer protection. Among those who reported feeling confident in their understanding of their rights, 89% said they felt well protected as consumers. Conversely, perceptions of protection were substantially lower among those who lacked confidence in their understanding of consumer rights. Consumers aged 18-24, for example, who reported the lowest levels of confidence, were also the least likely to feel well protected as consumers.

How adequate is consumer information and advice?

The previous analysis examined consumers’ self-assessed levels of confidence generally, and in relation to knowing their consumer rights more specifically.

Consumers’ confidence and knowledge of rights is influenced by a range of factors. One factor that influences confidence is the availability of information and advice, both about products specifically, or about consumer rights generally.

It is important to distinguish between consumer information and consumer advice:

• Information is provided to consumers in general (or groups of consumers).
• Advice is tailored to the specific circumstances of an individual.

Moreover, it is also important to distinguish between two broad areas that consumers may require information or advice on:

• At times they require information or advice on particular products or markets, often but not always at the pre-purchase stage of the consumer journey to help them make informed decisions – such as what type of choices they have on energy tariffs or broadband deals, for example, or which traders they can rely on for a particular project.
• Consumers may also require information or advice on their rights as consumers, and how they can access those (often but not always at the post-purchase stage).

It’s important to bear in mind that these issues of awareness of rights and how to exercise those apply as much to public, or quasi-public, services as private services. For example, awareness of advice and redress options is lower in the social rented sector than the private-rented sector (only 48% reported  knowing what to do if their landlord fails to address a housing issue compared to 63% in the private rented sector).[122]

The rest of this chapter considers first, consumers’ ability to acquire information on products, services and traders generally, before going on to consider the provision of advice on consumer issues. Consumer advice is a devolved matter, though sometimes (e.g. in relation to energy and heat networks) funded by industry levies that are reserved.

Information on products, services and traders

Trustworthy and reliable information is critical to build consumer confidence. One example of how the provision of information can support consumers to make informed decisions and engage confidently is through the adoption of accredited Trusted Trader schemes – described in Spotlight 4.1.

On the other hand, where information is lacking or unreliable, this can undermine consumer confidence and engagement. Spotlight 4.2 describes an example of how inconsistent and incomplete information – on public EV charging points – can undermine consumer confidence, potentially influencing uptake of this technology.

How do consumers perceive the availability and effectiveness of information?

At a general level, 70% of respondents to the Consumer Welfare Survey agreed or strongly agreed with the statement ‘I know where to look for reliable information about items and services’.

The proportion of consumers who agreed with this question was lower amongst younger people, the unemployed and those with lower incomes. It was markedly lower (37%) amongst those who are not confident in using the internet, reflecting how important the internet, and digital inclusion generally, have become in enabling consumers to access information.

It’s also important to note that responses to this question were sector-specific. Asked whether they know where to look for reliable information, agreement was highest for food and drink (76%), followed by mobile phones (74%) and electricity/gas (71%). Confidence was lower in relation to insurance (67%) and particularly low for used-cars (48%).

Given that much of the information that consumers rely on is provided by businesses, consumers’ trust in businesses plays an important role in shaping consumer confidence and empowerment.

A reasonably high proportion of consumers (69%) agreed that they trust businesses to provide them with accurate information. However, levels of trust varied across different groups of consumers. Just 53% of respondents whose disability limits their day-to-day activities a lot agreed that businesses provide accurate information, while agreement fell to 59% among those have fallen behind with at least some bills and commitments over the past 12 months.

These findings suggest that consumer trust in organisations is closely linked to broader experiences of vulnerability and confidence. Groups who were less likely to describe themselves as confident and savvy consumers, and who reported lower confidence in understanding their rights, were also less likely to trust the information provided by businesses.

Spotlight 4.1: The role of Trusted Trader schemes in building consumer confidence

A positive development in Scotland has been the work undertaken by some trading standards authorities to encourage the adoption of approved Trusted Trader schemes.[123] Such schemes now exist in 22 local authorities in Scotland primarily in relation to home improvement businesses.[124] 

These approved trading standards schemes provide consumers with reassurance that the business has been fully vetted, that customer reviews are genuine and that the scheme is trading standards backed and supported by Police Scotland and consumeradvice.scot.

It also provides businesses, many of which are small businesses, with an important mechanism for distinguishing themselves from less reputable traders.

Consumers can identify members of Trusted Trader and other equivalent schemes such as Buy with confidence (adopted by a further 3 local authorities in Scotland) via Scotland’s Approved Trader Directory.[125] 

Unfortunately, local authority approved trader schemes do not exist in all local authority areas. They can be resource intensive and not all Trading Standards services have the resources to introduce them. 

They also only apply in certain sectors (home improvement businesses tend to be the majority). Consumer and small business awareness of these schemes is also likely to be low, particularly since the schemes are not available everywhere.

It can also be difficult to distinguish between effective high quality and accredited schemes on the one hand, and trader recommendation platforms where no effective checks are carried out.

Development of an easily identifiable means for consumers to use to determine if traders are reputable along with a public education campaign is therefore important. Broadening the roll-out of these and similar schemes, and promoting consumer awareness of them, can help to enhance the consumer experience and build consumer confidence.

As indicated previously, the UK government announced in August 2026 that it is working with the Furniture and Home Improvement Ombudsman to develop an approved code specifically for the Home Improvement Sector to include access to an Ombudsman scheme.[126]   This is likely to have implications for existing Trusted Trader schemes in Scotland, and developments should be monitored closely.

Spotlight 4.2: Transparent and reliable information for EV drivers

Transparent and accurate information is essential to empowering consumers to make purchasing decisions without the risk of incurring detriment. Within the public charging sector for electric vehicles (EVs), however, consumers are too often having to plug in their car to charge without an accurate understanding of the final costs.

While EVs currently make up the minority of vehicles on the road,[127] that is set to change with current UK Government policy set to phase out the sale of new petrol and diesel vehicles by 2030, and new hybrid vehicles by 2035.[128] This is a significant change for Scotland’s consumers, particularly those who live in circumstances where they are primarily reliant on the public charging network, believed to be over half of Scottish households.[129]

The mental energy needed to negotiate public charging infrastructure can be significant. Drivers need to navigate costs which vary between charge point operators and charge speed, and are not always clear on what they include and how they are calculated. Consumer Scotland’s 2026 research found that around a quarter (23%) of EV drivers have concerns around the cost of using the public charging network.

The current variability in pricing across charge points can also create uncertainty, making it difficult to plan ahead.

“Some of them are just ridiculously high. They’ll charge you like 85p a kilowatt. It doesn’t make sense when other chargers are like 35p or 40p a kilowatt.” - Current EV driver

Consumer Scotland research shows that EV drivers face challenges in being able to accurately compare prices between different providers, and understand the likely total price before they plug-in.[130] This can reflect:

• Lack of clarity around the price difference between rapid and slow chargers, and consumers’ underestimation of how much more expensive faster chargers can be.
• Frequent use of “hidden” fees such as minimum charges, parking charges, and overstay fees.
• The frequent requirement for drivers to have the relevant app on their phone to understand pricing structures in full.

These contribute to a situation where EV drivers report being unclear on the overall cost they’re paying to charge their vehicles with public chargers.

Current charge point regulations do include standards around price transparency,[131] but these only require charge point operators to display the maximum price that a consumer could be charged per kWh inclusive of fixed charging fees, and allows the operator to make this available through a separate device such as an app.

In practice, this means that EV drivers may need to access multiple apps in order to compare prices before they begin charging, and can only know the maximum price they will pay rather than being able to accurately compare actual prices that include their fixed charge elements.

EV drivers are entitled to transparent pricing that is available upfront to all drivers, not just those that have downloaded the relevant app, and that is not limited to the maximum price but instead allows drivers to predict with certainty what their final cost will be before starting to charge.

How effective is information for small business consumers?

The provision of reliable information is equally as important for small business consumers. Previous Consumer Scotland research found that the majority of small businesses were confident they knew how to secure the best product for the business when purchasing goods and services.[132] However, there was variation by sector, with fewer – just less than 70% – of small businesses confident they could secure the right product in energy.

As is the case with individual domestic consumers, small business consumers can access information from a wide range of sources. In some sectors, Third Party Intermediaries (TPIs) can play an important role in supporting small business consumers to navigate complex markets and secure the tariffs that best meet their needs. This is particularly the case in energy, water, financial services and telecoms markets.

Whilst TPIs play an important role, they don’t always meet small businesses’ needs effectively. Spotlight 4.3 describes how planned changes to the regulation of TPIs in the energy sector are intended to improve small business’ confidence engaging with them.

Spotlight 4.3: The role of Third Party Intermediaries in helping small businesses access suitable energy tariffs

For many small businesses in Scotland, energy is both a significant operating cost and an essential service. Securing an energy contract that reflects a business's needs can have an important impact on profitability, cash flow and competitiveness. However, navigating the non-domestic energy market can be challenging. Small businesses often have limited time, expertise and resources to compare suppliers, understand contractual terms, assess pricing structures and negotiate contracts.[133]

Third Party Intermediaries (TPIs), including energy brokers and consultants, can play a valuable role. TPIs help businesses compare tariffs, understand available options, identify suitable suppliers and navigate often complex contractual arrangements. Many businesses regard brokers as an important source of support when purchasing energy.[134] [135]

The majority of businesses that use brokers report positive experiences.[136] Ofgem's 2025 non-domestic energy research found that around 72% of businesses that had used a broker were satisfied with the service they received, a figure unchanged from the previous year.[1][137]

However, the experience of using TPIs is not always positive. There is also evidence of a range of consumer harms associated with some broker practices. These include misleading claims about market coverage, pressure selling, differences between quoted and actual prices, limited transparency regarding commissions paid by suppliers, unclear contract terms, hidden fees and poor complaint handling.[138]  Businesses have also reported confusion about verbal agreements, with Ofgem's qualitative research finding that only a minority understood that verbal agreements can be legally binding.[139]

These concerns are particularly significant because small businesses generally enjoy fewer protections than domestic consumers.[140] Unlike household consumers, small businesses are not protected by an energy price cap and typically have more limited rights when entering or exiting contracts. As a result, poor advice or unsuitable contracts can expose businesses to significant financial risks.

In response, the regulation of TPIs is evolving. The UK Government has committed to introducing a statutory regulatory framework for TPIs operating in the retail energy market, with Ofgem expected to become the sector regulator.[141] The proposed regime aims to establish minimum standards of conduct, improve transparency, address conflicts of interest and strengthen arrangements for complaint resolution and redress.

Stronger regulation can help ensure that small businesses receive reliable information and advice while preserving the benefits that well-functioning brokers provide, improving small businesses’ trust in TPIs, and helping them to engage confidently in energy markets.

The changing nature of consumer advice

When problems arise that consumers cannot easily resolve with suppliers, consumers have a range of options if they feel they need advice on their rights and next steps.

One option is to contact Scotland’s national consumer advice service – consumeradvice.scot – which is provided by Advice Direct Scotland (ADS).

Depending on the specific issue however, other bodies can also provide advice – notably the Citizens Advice Bureaux in relation to matters around housing or debt.  Some of this is funded via the Scottish Legal Aid Board which provides grant funding for projects mainly for housing and debt.[142] A number of energy charities can provide advice in relation to energy issues.

Consumers are beginning to turn to Artificial Intelligence (AI) tools for information and advice about their rights, and how to resolve problems (Users often interpret the information they receive from AI tools as ‘advice’ as there is a sense that the AI tool has tailored it to the specific issues facing the user). Around one quarter (23%) of respondents to the Consumer Welfare Survey said they had used AI in the past 12 months to seek information about their consumer rights. Younger consumers were more likely than average to have used AI for this reason, including those aged 18-24 (31%), aged 25-34 (48%), and aged 35-44 (38%).

In principle, AI tools can help to empower consumers, providing accessible information to consumers about specific consumer issues and rights – at least for those consumers who have the digital capabilities to capitalise on these opportunities.

At the same time however, the jury is still out on the reliability of these tools to provide reliable advice. These issues are considered in more detail in Spotlight 4.4.

Further exploration of the effectiveness and reliability of advice being provided by GenAI is warranted. This is particularly the case in markets, such as financial and legal services, where the provision of advice (as opposed to guidance) is regulated.[143] It is likely that action will be required to improve consumers’ ‘AI literacy’ – their knowledge of how to engage productively with the tools, the pitfalls, and the steps required to verify advice provided by the tools.

At the same time however, it also needs to be recognised that GenAI will not be a satisfactory solution for all consumers in all circumstances, particularly those with limited digital literacy or in vulnerable circumstances. GenAI does not negate the need to ensure that more traditional forms of consumer advice remain available.

Spotlight 4.4: Should consumers rely on GenAI as a source of advice?

ChatGPT was introduced to the public in 2022, and since then the use of generative AI (GenAI) tools has increased. In 2024, 96% of people in the UK were aware of the term ‘AI’[144] in general, and in 2025, over half of people in the UK used GenAI to search the web for information.[145] This includes to get consumer information on areas where professional advice is recommended. 17% rely on GenAI for financial advice, 19% rely on it for medical advice and 12% rely on it for legal advice. [146] 

There are also notably high levels of consumer trust in the information people receive from GenAI. About half of all users trust the information they receive to a great or reasonable extent. This increases for regular users of these tools.[147]

GenAI appeals to users because it appears to provide tailored, accurate advice on consumer issues rapidly and at low cost. However, it remains unclear how reliable some of the advice provided by GenAI is. In 2025, Which? conducted an investigation into how accurate common GenAI tools were in answering 40 common UK consumer questions. They found that “AI search tools often make mistakes, misread information and even give risky advice”.[148]

The tendency of GenAI to provide misleading advice has been observed in other contexts, such as health.[149] Some of the explanations for AI’s inaccuracies relate to the challenges it faces in taking into account all relevant personal circumstances, and its inherent tendency to want to ‘please’ the user, by providing answers that help keep a user engaged.[150]

There is the potential that any inaccuracies of GenAI tools in providing consumer advice might be amplified in a Scottish context, if GenAI tools do not recognise Scottish-specific aspects of the consumer advice, information or regulatory landscape. For example, it is unclear whether GenAI tools would recognise that, for example, the advice landscape differs in Scotland compared to other parts of GB, or whether GenAI tools would recognise Scottish-specific regulation in relation to aspects of housing, health, or legal services.

Consumer Scotland has recently launched an investigation into the reliability of GenAI in providing consumer information and advice – and the risks and pitfalls that consumers should be aware of when using GenAI in this context.[151]