The Review builds on data focused regulatory initiatives
Targeted support, simplified guidance and holistic advice will co-exist using the same underlying ‘open data rails’
Firms must reimagine life and product events and use data to help consumers compare, choose and buy financial products and services
Moneyhub, the leading provider of Open Banking, Open Finance and Financial Wellness solutions to the Pensions and Investment industry has today submitted its response to the Financial Conduct Authority’s (FCA’s) Advice Guidance Boundary Review proposals (DP23/5).
The FCA’s proposals seek to bridge the ‘Advice Gap’ which has resulted in just 8% of adults* reportedly taking financial advice, leaving millions of people unsure where to get help with decisions about investments, savings, pensions or retirement planning.
Open Banking, Consumer Duty and Pensions Dashboards unlock consumers’ access to their data whilst putting customers’ needs at the heart of every financial services business. The Advice and Guidance Boundary Review can unite these regulatory initiatives so that, when it comes to managing their money, consumers can quickly and easily see both what they have and what to do next. The Data Protection and Information Bill will enable new Smart Data schemes and enable consumers to control their data like never before.
Sam Seaton, CEO of Moneyhub said:
“The FCA's proposals are a game-changer which Moneyhub supports. We know consumers are missing out on potentially higher returns on their money because products are too complicated; They don't know who to trust and advice is too expensive. Data is the answer for making advice accessible and implementing the new proposals.
“Targeted support, simplified guidance and holistic advice will co-exist using the same underlying ‘open data rails’ with an appropriate regulatory framework over the top.
“Matching consumers who have defined objectives, needs and characteristics with suitable products, using data sharing and automated ‘nudges’, is a logical extension of the use of consumers’ data. Our financial wellness platform is already helping consumers to become more aware and informed, combined with our technology firms can now deliver targeted support and simplified guidance to millions of consumers”.
Vaughan Jenkins, Managing Director of Partnerships at Moneyhub said:
“Moneyhub supports the Government and the FCA's desire to build a framework which consumers can trust, recognising the complexity faced by consumers in making financial decisions. We believe that Open Finance, within the emerging Smart Data environment, will play a significant part in the realisation of these ambitions.
“We urge regulators and policymakers to orchestrate Open Finance, Consumer Duty and the Advice and Guidance Boundary Review into a single coherent and comprehensive agenda for sustainable change.
“Product manufacturers should be required to publish Open APIs that support customers’ access to their data and enable them to share data by their consent. This is the key to improving competition in favour of consumers”
ENDS
Notes to editors
Moneyhub’s response
The FCA outlined 3 proposals to make guidance and advice more accessible:
1. Clarifying the boundary between guidance and support
Moneyhub believes that over time, and in response to Consumer Duty, product providers will provide more automated ‘guidance’ (alerts, notifications and illustrations) within the current regulatory framework by making better use of the data and insights firms already have about consumers' use of their products. Indeed Moneyhub already does this for its clients across a range of products.
2. Targeted Support
Targeted support provides the potential to reimagine life and product events by using data to help consumers compare, choose and buy new financial products and services, or change the way they use existing products. Moneyhub can help appropriately regulated firms access a wealth of consumer information on which suggestions can be made based upon ‘people like you’ with shared objectives, needs and characteristics. This proposal has huge potential to help consumers who would not normally access any form of advice to make informed decisions about their money after sharing data about themselves.
3. Simplified Advice
Simplified advice means it will be possible to use a customer’s product and financial data to build an accurate and auditable picture of their finances so that a personal ‘decision tree’ could be created to drive a simple product recommendation or course of action, for example, to open or top up an ISA invested in a specific fund. Moneyhub is already working with firms to test how goals-optimisation can be combined with an automated feed of consumers’ financial data to show the probability of a financial outcome being achieved and create a personalised recommendation.
About Moneyhub
Moneyhub is a data, intelligence, and payments company which develops ISO 27001-certified software for Open Banking, Open Finance, and Open Data applications. Its FCA-regulated Open Data platform enables companies to quickly and easily transform data into personalised digital experiences and initiate payments. Its APIs and fully customisable platform provide data aggregation, insights, notification nudges, and payment systems. As a result, clients have the consent-driven data and analytics they need to create super-personalised offers, products, and services. Hundreds of organisations, spanning finance to media and retail, rely on Moneyhub’s award-winning technology.
For more information, please visit www.moneyhub.com
*DP23/5: Advice Guidance Boundary Review – proposals for closing the advice gap