Is there a commercial market for Independent Financial Guidance


Is there even such a term?  The FCA seem to think so

‘Guidance’ is a much broader term (than advice) and includes more general information about financial products.

  • It can include information about different types of investments or general principles for you to consider when investing.
  • It will not recommend a specific course of action to you or give a personal recommendation about how you should invest.

Guidance can help you understand the different investment options before you decide for yourself how to invest your money. Some people use it to narrow down their options before seeking advice.

I wouldn’t disagree with this , but the FCA go on to list the providers of financial guidance as various government sponsored bodies. Is there such a thing as commercial guidance and if so – where is it to be found?


It is clear that there is demand for guidance on financial matters, and it is available through journalists such as Paul and Martin Lewis who provide factual information to the mass of us on which we take decisions.

The scope of their guidance is rather limited, it is bounded by debt and savings and rarely extends to investments. Investments, being speculative, are dangerous ground for journalists and the success of mass market journalism is in knowing where to stop.

The algorithmic approach to investment guidance, pioneered by robo-advisers such as Nutmeg, is based on an analysis of data and a reliance on artificial intelligence. this identifies and highlights well trodden investment pathways.

A crowd’s “wisdom” can all too easily become “herding”, but the creation of algorithms that help people decide is not confined to Amazon, people like me do tend to use default solutions which have been proved to work.

Where data science leads us, we will tend to follow, because we do trust data. There is demand for data driven guidance and we see it in all kinds of products from trust pilot to trip advisor; we follow influencers we trust.


If there is to be a commercial market for independent financial guidance, it is going to have to be nurtured. The FCA have, Call for Input  on consumer investments  make it clear that consumers need guidance and that support will necessary for this to happen.

As part of the RDR/FAMR review we have been working with firms to understand their concerns so they have the confidence to give consumers the guidance they need…We would like to see more firms offering broader forms of high-quality support for their customers and testing how this can work in practice. We may need to provide a degree of regulatory oversight and comfort for some of these tests, akin to our Sandbox regime.

Ironically, it is only since AgeWage has been in the FCA’s regulatory sandbox, that we have experienced just what a challenge guiding people is.

We are discovering that our data-driven service is meeting with the opposition of many of the providers we are working with, not least because we are letting data do the talking.

Here we are encountering a phenomenon , I had almost forgotten about, the advisor as agent not of the consumer but of the provider. Increasingly I am being asked to be complicit with providers who are prepared to share data with us but on their terms.

This challenges the idea of independent financial guidance  from both ends. If we are to be selective about the way we present data to consumers, we are moving into an area of influence that is dangerously close to advice. And if we do at the request of providers, we are looking less independent and more tied agents.

While I can see demand, I am beginning to understand how the supply side of independent financial guidance is so difficult.


It is hard to see a private sector market for independent financial guidance flourishing as the FCA would like it. It would require the co-operation of those who hold our money and our data and that is not going to happen without regulatory intervention,

Perhaps things will change when and if the Pension Schemes Bill achieves royal assent and the data requests of the pension dashboard are mandated to be met.

For now we have the GDPR but while data controllers are keen to use this to keep others noses out of their data, they seem prepared to ride rough-shod over consumers rights to their data in machine readable format let alone honor the consumers right to portable data (shared with third party applications).

The law can be flouted because big financial institutions can always point to small ones and argue they have the stronger security protocols. This is how the banks resisted calls for open banking and it is how they insurers and others will resist open pensions.

My conclusion is that we will need regulatory intervention for consumers to get independent guidance and that the FCA and tPR have much to do to make this happen.

Right now, we can only see the delivery of independent financial guidance being achieved as an employee benefit, for large employers are the only entities with the strength to stand up to those who have our money and our data.

A commercial independent financial guidance market is a possibility, provided employers are prepared to assert their and their employee’s rights  to data.

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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2 Responses to Is there a commercial market for Independent Financial Guidance

  1. Richard Taylor says:

    Can there be such a thing as “commercial guidance”? I think the answer is yes. Can there be such a thing as “independent commercial guidance”? That is much harder to see, because that would need to be a commercial (ie fee-paying) proposition which nevertheless left all the liability for a bad purchasing decision with the consumer – and it would need to be sure that it did not inadvertently stray into “advice” (ie suggesting or implying that something was suitable for the client).

    Of all the challenges an independent commercial guidance proposition would need to overcome, perhaps the biggest would be developing a large enough client base to make the development and ongoing service provision profitable. It doesn’t matter how good the proposition is, or how well it meets regulatory requirements, if the customers don’t ‘walk through the door’ it won’t work commercially.

    However, some people already have the customer base and the potential footfall – banks and insurers have a very large number customers, about whom they already know a great deal, and so only need to convert some of them to a guidance solution to make it worthwhile. And the charge for the service would be wrapped up in the product, not separated out, as it is with advice, making the guidance appear free.

    So, that is why I suggest that an independent commercial guidance proposition is much less likely to be developed than a commercial service tied to a product provider and offered ‘free’ to the existing customer base. None of that implies that such a solution would be simple – not even using an automated process – but it just seems more likely to me. Of course, I could be wrong and a form of “compare the market” where the guidance is funded by the product providers could develop – but it’s far from clear to me how this would actually be paid for.

  2. There are opportunities, I’m sure. For example our (Ferret’s) pensionForward system is largely used by IFAs plus some advice services, but it could be used by others. It deals solely with the consequences of different ways of using pension savings on tax/benefits and doesn’t cover any of the regulated areas. It could be used to guide people into deciding which *type* of decumulation to use, which could be a commercial service that would be be useful.

    Having said that, I’d be very worried if someone set up in business to do that without knowing about the underlying system in some detail.

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