Speaking at a TISA event, Charles McCready, TSIP1 Programme Director, highlighted a general lack of consumer understanding of both the need to manage personal finance and how to do so, as well as how to develop appropriate guidance and advice services that align with consumer needs, providing support in a cost effective way.
Charles said:
“Whilst TISA has focussed its response on proposals for guidance services, much of the industry is also trying to address access to financial advice and how these services are provided as this remains a challenge for both the Government and financial services. Much of the focus of the FAMR is centered on how to fix the ‘advice gap’, and the industry responses show that there are significant opportunities to both simplify the advice services that consumers receive, whilst simultaneously developing those services that fits people’s needs and their appetite to pay for advice.
“At the heart of the proposed changes lies the need for greater clarity and simplification around the rules of advice and the options available to consumers. There is also a growing appetite amongst the financial services industry to align advice regulations with MiFID and EU regulations and remove some of the additional requirements placed on them in the UK. This would move us closer to a single EU set of standards, retain consumer protection and facilitate a reduction in additional compliance costs that could be passed onto the consumer. We have also heard a strong call for the interpretation of rules to be made clearer so that the FCA, the financial services industry and FOS are all operating under the same understanding of those rules.
“Additionally, there is a critical role for technology to play through greater use of online tools, particularly for information and guidance services, to help consumers understand how to better manage their finances. In an ever changing environment, it is important to find new ways to appeal to younger savers who have new perspectives and attitudes to savings. FAMR is a particularly important initiative in seeking to address the key issues that are affecting the financial health of both households and individuals."
