Today sees the official launch of the Financial Conduct Authority’s new Targeted Support regime, enabling banks, pension providers and other financial firms that are authorised for Targeted Support to provide financial suggestions designed for groups of consumers.
Targeted Support is designed to provide limited financial guidance to groups of consumers with common characteristics. The aim is to increase the availability of financial guidance to more consumers.
The FCA claims it could benefit at least 18m over the next decade.
Under Targeted Support providers and advisers can provide outline financial guidance, but not bespoke personal advice, to savers with ‘common characteristics’.
Under guidelines from the regulator, when firms are creating a consumer segment and defining common characteristics, they should consider the following in particular:
- A consumer segment is a group of individuals in a situation involving a shared financial support need or objective and, where relevant, common characteristics.
- To the extent that common characteristics are relevant to the definition of a consumer segment, they must include both: including characteristics; and excluding characteristics.
- When defining common characteristics of a consumer segment, firms should have regard to what would make a suggestion suitable or unsuitable for an individual within the consumer segment.
- Consumer segments must be defined at a level of detail that is sufficiently granular as to enable firms to assess whether a ready-made suggestion would be suitable for an individual within that segment.
- Consumer segments must also not be defined at a level of detail that a firm in the business of providing investment advice would reasonably associate with a comprehensive consideration of a consumer’s characteristics or circumstances.
The FCA said firms have to judge how to design consumer segments, “at a sufficiently granular level while not comprehensively considering the consumer’s circumstances or characteristics.”
It said the complexity of a situation is likely to be relevant to the type and/or number of common characteristics needed to ensure that segments are sufficiently granular to ensure a ready-made suggestion is suitable for an individual in the consumer segment.
It said if a firm can’t define a suitable suggestion without undertaking a comprehensive consideration of a consumer’s circumstances or characteristics, it’s likely that the consumer will be in a situation that can’t be addressed through Targeted Support.
The regulator has previously said it will be encouraging DC pension providers to offer Targeted Support to improve consumer decision-making ahead of the launch of Pension Dashboards.
It said that low customer understanding and engagement continued to be a challenge within the pensions market, contributing to concerns about adequacy.
According to Opinium, many advisers see Targeted Support as potentially fuelling the demand for financial advice, with just one in five advisers seeing it as potentially damaging to regulated advice.
Among the key findings from the survey:
- 57% of IFAs say that Targeted Support will help clients “better plan” their financial future
- 52% say new clients have accessed advice to plan for new financial goals
- 46% of IFAs believe access to targeted pension and investment support would make people “more likely” to seek independent financial advice
However, others have shared concerns of providers using Targeted Advice to sell products rather than providing guidance.
The Financial Ombudsman Service said that it expects to receive complaints related to the FCA’s new Targeted Support regime in the 2026/27 financial year.
The FOS budget document hinted that the FOS expects a considerable number of Targeted Support complaints. It said: “We will be able to look at complaints about this service from early 2026.27, however we do not expect to start seeing a significant number of complaints in relation to this type of advice straight away due to the nature of investment advice.”
Opinium surveyed 200 IFAs between 2-9 March 2026.