The latest Financial Lives Survey from the FCA found that one in ten people have no cash savings, and another fifth have less than £1,000 put aside for a rainy day.
The FCA has produced a workplace savings guide to provide clarity for employers on the rules surrounding employment-based schemes.
The regulator said it produced the guide to enable employers and savings providers to offer workplace savings schemes “with greater confidence.”
Currently only 7% of employers offer workplace savings schemes.
The guide focuses on opt-in schemes and addresses each of the perceived regulatory barriers for employers considering offering workplace savings.
It sets out how employers can avoid breaching national minimum wage requirements, making sure that a worker receives at least national minimum wage pay for each reference period.
For example it warns that any delays in employees being able to access their funds could mean the employee falls below the minimum wage.
It reminds employers that workplace savings schemes can be structured in a way that does not involve the employer having to carry out a regulated activity, with funds being transferred to a savings provider rather than being retained by the employer.
The guide also explains how employers can meet financial promotions requirements when making arrangements for employees to open savings accounts.
The regulator has partnered with the Treasury, the Money and Pensions Service, the Information Commissioners Office, the Department for Business and Trade and the Prudential Regulation Authority to create the guide to opt-in workplace saving schemes to help increase the number of employers offering them.
The latest Financial Lives Survey from the FCA found that one in ten people have no cash savings, and another fifth have less than £1,000 put aside for a rainy day.
Emad Aladhal, director of retail banking at the FCA, said: “Financial inclusion is a shared effort, which is why we’re teaming up with partners and playing our part to help businesses understand how to apply the rules for the benefit of consumers.
“This clarity should give employers greater confidence to offer savings schemes that can help people navigate their financial lives.”
Workplace savings and pensions provider Scottish Widows welcomed the new FCA guidance.
Pete Glancy, head of policy at Scottish Widows, said: “Uptake of these workplace savings schemes has, so far, been poor. The government's intervention is positive but they may need to go further than clarification, and consider an auto-enrolment style initiative to boost participation.
"It's key as the government tackles the nation's savings levels, that none of this is looked at in isolation. There is more work to be done to truly support people’s financial journey throughout their lives, from starting to save, to home ownership and into retirement.”
