Everything You Ever Wanted To Know About Investment Pathways

With the deadline for the upcoming Financial Conduct Authority (FCA) PS19/21 investment pathways regulation sliding into the cross hairs of most drawdown product providers. EValue hosted a packed webinar that answered your burning questions around the new regulation aimed at helping non-advised consumers.

The webinar, hosted by Tim Jablonski, EValue Product Director, also featured Technical Product Consultant, David McDonald, who sought to cover all the critical considerations around the FCA’s PS19/21 and PS19/30 policy statements and other recent updates to COBS, PROD, and PERG. 

A review of the FCA regulation

Tim kicked things off by highlighting that while some of the updates to COBS 19.10 in PS19/21 have been very prescriptive around the design and implementation of the investment pathways choice architecture, there are other areas where the FCA has provided less clarity. This has come, namely around the topic of appropriateness. 

As one webinar attendee pointed out, “Does the extension of the remit of our IGC by the FCA mean that the appropriateness of our pathways funds is entirely subjective?”. 

In answer to the question, Tim agreed that there was a level of ambiguity within the regulation but outlined;

Our findings show that an IGC or GAA will be assessing value for money, including the underlying investments and allocations and whether any communications to relevant consumers are fit for purpose.” 

To help providers learn more about what their IGC or GAA will be assessing, click here now to review our essential seven-point checklist. You can also learn more about the EValue Appropriateness Report or to download a preview of this, please click here.

What do you need to consider as part of the project?

The hosts progressed to cover what providers will need to do to be compliant by 1st February 2021. For many drawdown providers, the new regulation comes at a time when they and their customers are still dealing with the impact of a global pandemic. 

Product providers really only have two options when it comes to implementing their project journey with the following:

Option 1

An off-the-shelf, white-label customer communication tool that clearly illustrates the investment pathways choice architecture to non-advised consumers;

  • Readily available solution
  • Speed to market
  • Regulations and compliance met
  • Ongoing licence fees & integration costs


Option 2

A DIY Solution where you build the front-end in-house and outsource our range of risk and retirement APIs, widgets, or components;

  • Control over user journey
  • Unique customer experience
  • Utilise third party APIs or Components
  • Development costs

How we can help you and your customers.

To help support clients during this challenging time, EValue has announced the release of its own range of investment pathways solutions which will be available from Monday 3rd  August.

For your customers accessing money from their pension, this is a service that meets the FCA regulations for investment pathways and helps retirees invest their money in a way that's appropriate to their personal financial objectives.

You benefit from:

  • A service that meets the FCA regulations for investment pathways
  • Fewer people taking all their money out of the pension scheme
  • Reduced risk of poor decisions and complaints

Your customers benefit from:

  • Improved awareness of the pension options available
  • Improved awareness of the income that can be generated from their money
  • Better decisions on when to access pension saving

So what next?

There is plenty to consider before February 1st 2021. You will need to design and supply a default investment solution, ensuring the best outcome for each customer objective. You must appoint an IGC or GAA to assess the appropriateness of your chosen pathway solutions, and then to communicate the appropriateness of each option to your customers. Ensuring they understand the risk and reward characteristics of their chosen investment pathway decision.

Our choice architecture is provided as software as a service integrated into your website, to book an extended demo please visit https://www.ev.uk/investment-pathways.

We understand that every customer is different. And for many of you, an off-the-shelf solution may not meet your unique set of requirements. With this in mind, a DIY approach could be the right option for you.

By implementing a DIY approach through a range of risk and retirement APIs to analyse the funds available, you can help your customers to make better-informed decisions when selecting the right fund for them.

To find out if this approach might be the right one for you, read our helpful blog; Solve Your Customers’ Financial Planning Problems With Your Own User Journey.

As the 1st February 2021 draws closer, there is still much to do. To find out more about the range of EValue investment pathways solutions, please click here. Alternatively, if you’re keen to experience a demo of the off-shelf-tool or find out how we can support your back-end financial requirements, please feel free to request a demo now.

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