FCA plans announced today to allow firms to offer ‘targeted support’ have been widely welcomed across the financial services sector.

Keith Phillips, CEO of The Platforms Association, called the FCA’s move, “an important intervention.”

Jonathan Lipkin, director for policy, strategy & innovation at the Investment Association, said: "These proposals are an important milestone to make financial support more accessible, timely and aligned with consumer needs.

“The combination of targeted support, simplified advice, alongside well-designed retail disclosure, which empowers consumers to take informed decisions, can enable our industry to better serve the UK’s retail investment and pensions' markets, boost financial inclusion and support better long-term outcomes for customers.”

Steven Levin, CEO of adviser and platform firm Quilter, said the consultation, “marks a major step in addressing the advice gap.

He said: “For the first time, there’s a detailed framework for how firms can offer meaningful support to consumers without crossing the line into regulated advice.”

He added that it was important to distinguish between targeted support and holistic financial advice. “Those already receiving ongoing advice do not need targeted support, and the new framework should focus on helping those who would otherwise struggle to access guidance.”

Verona Kenny, chief distribution officer at Aberdeen Adviser, said: “The advice gap has been acknowledged for years, but never properly addressed. The FCA has great ambitions, and this seems like the best chance in a generation to tackle the problem.”

Tom Selby, director of public policy at AJ Bell, said the proposals could be a “gamechanger for consumers, potentially helping millions more savers make better-informed decisions about their finances.”

He said the challenge will be creating a regime, “which genuinely allows advisers to provide a stripped-back service to clients at a lower cost. Part of the success of both targeted support and simplified advice will come down to the regulatory requirements, but part of this will also rest on the approach the Financial Ombudsman Service (FOS) takes.

“If both organisations are flexible and pragmatic, with a clear focus on delivering good outcomes for investors, these reforms should be a genuine game-changer.”

Dan Olley, CEO, Hargreaves Lansdown, said the changes, “will be truly transformational in kick-starting a thriving retail investment culture in the UK over the coming years.”

He said: “For the first time, we will be able to provide targeted support that is much more relevant for each of our clients. We will be able to tailor conversations and the digital experience to where they are in their investing journey, helping them see the potential of certain choices, which could have large positive impacts on their financial outcomes over the long term.

“We can also be even more present at those critical life stages such as the move into retirement, where we will be able to guide people more effectively in how to make the most of their accumulated assets to ensure they realise the financial freedom they have saved and invested for.”

The FCA has asked for comments on its proposals by 29 August.