The Investing and Saving Alliance (TISA) has urged the FCA to reconsider its proposed changes to the targeted support regime.
While strongly supporting the regime in general, TISA has raised concerns about the FCA’s proposed mandatory signposting requirements for pension communications and its approach to remuneration disclosures.
It believes the proposed mandatory signposting rules could result in firms being required to direct customers to targeted support services before those services are fully operational or available.
This, it said, risks creating confusion and frustration for consumers, while placing unnecessary compliance burdens on firms, including firms that have no intention of providing targeted support.
TISA believes targeted support providers should be given the flexibility to communicate in a way that reflects their actual service models and rollout timelines.
It also warned that the FCA’s approach to remuneration disclosures may inadvertently undermine consumer confidence and trust.
By requiring firms to explain complex internal cost structures and cross-subsidisation models, TISa feels the proposals risk overwhelming consumers with information that is unlikely to be meaningful or helpful.
It added that the proposals may also be a barrier to targeted support being made available to members of trust-based pension schemes.
Targeted support – the missing piece in the UK’s pensions puzzle
Sophie Legrand-Green, head of policy at TISA, said: “Targeted support has the potential to transform how consumers engage with financial services, but it must be built on a disclosure framework that is intelligible, supports consumer confidence and aligns with how firms operate.
“The FCA should leverage the Consumer Duty and recognise firms’ ability to judge what information is most useful to their customers, how best to communicate it, and when their services will be ready.
“A flexible, principles-based approach – rather than rigid disclosure mandates – will better support innovation, operational readiness and consumer confidence.
“We welcome the FCA’s commitment to progressing this regime and stand ready to work with the regulator and industry to ensure its success.”
.
