FCA to create ’simplified’ financial advice regime


As part of its consumer investment strategy, the FCA has set out new proposals to improve people's access to financial advice so they can invest with confidence.

The proposals will create a separate, simplified financial advice regime, making it cheaper and easier for firms to advise consumers about certain mainstream investments within stocks and shares ISAs.

The watchdog’s recent Financial Lives survey found 4.2 million people in the UK held more than £10,000 in cash and are open to investing some of it. While keeping a cash buffer is a sensible way of dealing with unexpected expenses, consumers who hold significant amounts of excess cash may be damaging their financial position, as inflation reduces the value of their savings.

Strong regulation is essential for maintaining the UK’s high standards and protects consumers. However, the FCA recognises that adjusting the regime could help the advice market support mass-market consumers with simpler needs.

The FCA’s proposed changes aim to prevent in-person financial advice from being too costly for many potential investors, as this can stop them from investing when it may be in their interest to do so.

Sarah Pritchard, Executive Director of Markets at the FCA, said:

’Now more than ever, people across the UK should have access to useful and affordable financial products and services which can improve their quality of life and support the economy.

’These proposals are part of our work to deliver a consumer investment market where people can readily access support and firms aren’t deterred from providing it.’

The regulator is consulting on:

Streamlining the customer ‘fact find’ so advice is more straightforward for both firms and customers

Limiting the range of investments within the new regime so the advice is easier to deliver and understand

Making the qualification requirements for the new regime more proportionate so delivering the simplified advice is less costly for firms

Allowing advice fees to be paid in instalments so customers aren’t burdened by large upfront bills


By on Wed, 30 Nov 2022 10:35:00 GMT
Original link