In MMR CP11/31, the regulator said that under non-interactive sales, no advice will be required. Where there is no spoken or interactive communication in the sale, such as written word involved in purely online and postal sales, consumers will be able to purchase without advice – except for those classed as “vulnerable.”

Mike Jones, director of intermediaries at Halifax said: “One unintended consequence may be the future growth of ‘internet only’ lenders who would not be required to offer an advised service.

“Such lenders should have an alternative, possibly interactive channel in place where the applicant feels when completing the application on the internet, advice is needed.

“Also, the exclusion of an ‘execution-only’ option for sales to customers deemed “vulnerable” would limit the opportunities to undermine the advice proposals on a wide scale.”

He added: “Lenders will need to give careful consideration to any difference in interest rates or other terms between internet-only (and therefore execution only) and advice based deals, as this might be seen as a deliberate practice to avoid the need to provide advice.”

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