The UK’s Financial Conduct Authority (FCA) has introduced new rules for targeted support, allowing organizations to offer tailored guidance to consumers regarding suitable financial products.
According to the FCA report, 12.5 million consumers need help saving for retirement, and 38% of the working-age population is under-saving for the future. Last year, 59% of adults did not seek financial advice regarding investments, savings, pensions, or retirement plans, with only 9% receiving regulated financial advice.
The targeted support scheme aims to assist pension providers, building societies, investment firms, wealth managers, financial advisory firms, and consultancies. The goal is to create a financial advice portal for consumers requiring assistance in making informed decisions.
The consultation period for this proposal opened on June 30 and will close on August 29, 2025. Under the proposal, firms would identify specific consumer situations requiring support and offer “ready-made” solutions based on these contexts. The FCA is now progressing to the next phase of policy development for the targeted support scheme with investment and pension companies.
PIMFA, the trade association for wealth and financial advisors, has called for greater clarification on data collection and the communication of suggestions to consumers. Simon Harrington, PIMFA’s head of public affairs, emphasized the need to clearly differentiate between targeted support and regulated advice, stating that consumers should view suggestions as options rather than directives. He suggested that simplified advice could also help guide consumers who seek more assertive direction, provided it comes with clear regulations focused on specific transactions.
PIMFA has urged the FCA to offer better guidance on consumer segmentation and the phrase “better outcomes,” as well as cautioning against including General Investment Accounts and high-risk products in the targeted support, given their inherent risks. The organization also advocates lifting the ban on appointed representatives in investment and retirement markets to enhance guidance and supports the free model of the scheme, although they recognize potential commercial incentives for some firms.
The Investing and Saving Alliance (TISA) has echoed concerns about the FCA proposal, warning that without amendments to the Privacy and Electronic Communications Regulations (PECR), many consumers will be left out. TISA advocates for a uniform approach to targeted support across both digital and non-digital communication to ensure accessibility for those who may not be tech-savvy.
Sophie Legrand-Green, TISA’s head of policy, stated, “Targeted Support is a smart, consumer-friendly reform, but unless PECR is amended, three out of four consumers could remain out of reach.” She recommends enabling opt-out outreach to assist those currently disengaged and establishing clear boundaries for staff to deliver predefined support without deviating into advice.
Both PIMFA and TISA support the FCA’s reform but stress the importance of careful planning and adjustments to ensure effective and accessible support for consumers in need.