UK FCA near-final rules on new targeted support for pensions and retail investments

The UK Financial Conduct Authority (FCA) has published policy statement PS25/22, setting out near-final rules for a new regulatory framework on targeted support. Under the framework, authorised firms will be permitted to provide tailored investment and pension recommendations to groups of consumers with similar characteristics. This will direct people to products or to take actions with existing products that could put them in a better position in their financial lives. This will be done without the need to conduct individualised suitability assessments, but subject to consumer duty and product governance requirements. The government has confirmed that only authorised firms may provide targeted support. The rules cover design and delivery standards, disclosure obligations, charging and remuneration, application of existing requirements and monitoring outcomes. Following the consultation, the FCA has made the following changes to its rules as set out below.

Including:

• Updating the purpose statement from "better outcomes" to "better position" to clarify policy intent and avoid confusion with consumer duty obligations.
• Adjusting rules on consumer segments to prevent firms from using detail akin to full investment advice.
• Evolving the approach to targeted support and annuities, allowing firms to direct consumers to whole-of-market annuity brokerages and removing the break between targeted support and annuity sales journeys.
• Simplifying ongoing monitoring requirements, reflecting the one-off nature of targeted support.
• Introducing new disclosure rules requiring firms to label the service as targeted support when providing a ready-made suggestion.
• Amending the rules on charging, removing the proposed requirement for firms to ensure consumers understand remuneration for targeted support.
• Amending signposting proposals.

The FCA will formally make the final rules once the government makes targeted support a new specified activity with applications for permission expected to open in March 2026 and the rules taking effect from 6 April 2026, subject to legislation. The near-final rules are published now so firms have as long as possible to prepare for the regime's launch. Separately, the FCA published joint statements with the Information Commissioner's Office and UK Financial Ombudsman Service regarding targeted support.

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