Steven Cameron, Pensions Director at Aegon comments on the latest FCA Targeted Support consultation CP25/26 ‘Consequential Handbook changes following the proposals in CP25/17’:
“Within the largely technical amendments in the FCA’s latest Targeted Support consultation, there’s a proposal for firms to signpost to Targeted Support from the time the authorisation gateway opens in March. This will mean giving equal prominence to Targeted Support whenever a firm suggests customers seek guidance or advice. Firms will also be required to inform customers they can access information about Targeted Support on the MoneyHelper website. Where a firm offers Targeted Support, it can signpost to its own services.
“While over time, it’s sensible to make consumers aware of all support options available, signposting from as early as March next year could well backfire. Firms will currently be considering whether to offer Targeted Support, and if so, in which situations. They then need to obtain permissions. This means, initially, we’re likely to see Targeted Support offered by a relatively small number of firms in some simpler situations, with this hopefully expanding across more firms and situations over the coming year or years.
“A blanket signposting to Targeted Support in the likes of pension yearly statements from next March could simply confuse customers if they then find their pension provider doesn’t offer it and they can’t access it elsewhere. There’s also a risk that without careful explanation, they may expect Targeted Support to help in situations such as pensions consolidation, which the FCA has currently ruled out.
“Aegon does believe that Targeted Support can be a valuable service, providing it complements and doesn’t cannibalise full financial advice. But it could confuse and frustrate customers if the FCA requires signposting ahead of when Targeted Support has ‘bedded in’ and become more generally available.”
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