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FCA to explore barriers to digital innovation in advice

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  • 09/03/2016
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FCA to explore barriers to digital innovation in advice
The Financial Conduct Authority (FCA) has agreed to explore issues raised by stakeholders on barriers to digital innovation in financial advice through the Financial Advice Market Review (FAMR).

In its feedback statement to Call for Input: Regulatory barriers to innovation in digital and mobile solutions, the FCA said a number of the issues raised by respondents crossed over with those currently being considered by the FAMR.

Respondents said that lack of clarity over regulatory definitions for advice, guidance and personal recommendations were preventing the sector from exploring further use of digital and mobile solutions.

The FCA said: “Following the government’s pension reforms it is more important than ever to ensure that the provision of advice functions in a way that benefits consumers. As many stakeholders said in their responses, a number of issues relating to this Call for Input cross over with those currently being considered by the FAMR.

“We are working jointly with HM Treasury on this review and will be presenting a set of proposals to the government in spring 2016. Given the significance of this work and its relevance to the issues raised by respondents to our Call for Input, we will explore these issues through the FAMR.”

Stakeholders’ comments also suggested that the FCA should re-evaluate its ‘technology-neutral’ stance to foster a regulatory environment more conducive to digital innovation.

The FCA said that while it welcomed the feedback, it had confidence that its principles and rules provided the flexibility for new technology to be established.

David Finlay, distribution director at Northview Group, welcomed the FCA’s feedback statement.

“The UK is the global leader in financial technology, and the FCA has a crucial role to play when it comes to supporting the continued development of FinTech across financial services.

“In the world of mortgages, technology will play an ever more important role in the years to come. Whether shaping the design of products, propositions and communications, or improving the working lives of brokers into the future, there are huge opportunities for those in the industry that embrace the digital age and harness the benefits of FinTech to launch genuine innovations. We look forward to the FCA increasingly supporting the sector as Project Innovate continues.”

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