Britain’s financial regulator said on Monday it will make it easier for investment firms to give customers support with their pensions and investments, a move broadly welcomed by finance firms who had complained about the current strict rule book.
Under existing rules investment firms are restricted in how much support they can give customers outside of more highly regulated financial advice. This created an “advice gap” for those unable to afford the regulated advice, firms had said.
The Financial Conduct Authority (FCA) plans to create a new category of help for consumers called “targeted support” allowing firms to make suggestions to certain groups such as those not saving enough for retirement or holding excess cash.
The FCA said it also planned to ease rules for simplified advice, but added that there would remain a place in the industry for full financial advice. The watchdog will consult on the proposed changes before introducing them next year.
“We want to help consumers navigate their financial lives and plan for the long term,” said Sarah Pritchard, deputy chief executive of the FCA. “Some of the most difficult financial decisions we face are how to save, invest and prepare for a comfortable retirement.”
Investment firms welcomed the proposals but said the new rules had to be clearly defined and any potential penalties properly understood.
“The advice gap has been acknowledged for years, but never properly addressed. The FCA has great ambitions, and this seems like the best chance in a generation to tackle the problem,” said Verona Kenny, chief distribution officer at Aberdeen Adviser.
(Reporting by Iain Withers）
