The Advice Guidance Boundary Review (AGBR) is an FCA initiative introducing targeted support between guidance and regulated advice. This new framework could benefit 21.5 million UK consumers whilst creating opportunities for advice firms to serve markets previously considered uneconomic.
What is the Advice Guidance Boundary Review
The FCA launched the Advice Guidance Boundary Review to address the advice gap affecting 15.8 million UK adults who do not access regulated financial advice. Current regulations create a binary choice between generic guidance and full regulated advice, leaving many consumers without appropriate support for their financial decisions.
The AGBR introduces targeted support as a middle ground. This framework allows firms to provide personalised suggestions to groups of customers with similar needs without triggering full advice regulatory requirements. The approach aims to help consumers make better financial decisions whilst reducing costs and regulatory burden.
The FCA published consultation papers CP25-17 and CP25-26 setting out proposals for targeted support implementation. These consultations closed in 2025 with final rules expected to take effect during 2026.
Royal London modelling shows targeted support could benefit 21.5 million people in the UK. This represents a significant expansion of access to financial help beyond the 9% of individuals currently paying for full regulated financial advice.
Key Components of AGBR
The review creates three distinct levels of financial support with different regulatory requirements.
Guidance remains unchanged as generic information helping consumers understand financial concepts without personalisation. This includes tools, calculators and educational content applicable to broad audiences.
Targeted support represents the new middle ground. Firms can provide personalised suggestions to groups sharing similar characteristics without conducting individual suitability assessments. This approach reduces cost and complexity whilst offering more help than generic guidance.
Regulated advice continues as individual recommendations based on comprehensive assessment of personal circumstances. This remains appropriate for complex needs, large investments and situations requiring detailed suitability analysis.
The framework also enhances the existing basic advice regime, making it easier for firms to serve mass market consumers with straightforward needs cost-effectively.
Timeline and Implementation
The FCA’s AGBR follows a structured implementation timeline giving firms time to prepare.
Consultation phase ran through 2025 with papers CP25-17 covering targeted support proposals and CP25-26 addressing consequential handbook changes. Firms and industry bodies provided feedback on practical implementation considerations.
Policy statement publication is expected in early 2026 confirming final rules, implementation dates and any modifications based on consultation responses.
Implementation period will give firms time to develop systems, train staff and establish processes before targeted support goes live. Most firms should plan for 6 to 12 months preparation.
Full operational capability is anticipated by late 2026 or early 2027, allowing firms to offer targeted support to consumers.
Firms should begin planning now even before final rules publish. Early preparation positions organisations to launch quickly when rules take effect.
How Targeted Support Works
Targeted support enables personalised suggestions based on customer groups rather than individual assessment.
Customer segmentation groups consumers with similar characteristics, needs and circumstances. Firms might segment by age, retirement timeline, investment amount or financial goals.
Needs-based suggestions provide recommendations appropriate for each segment. Rather than assessing individual circumstances comprehensively, firms suggest solutions meeting common needs within groups.
Personalisation occurs through applying segment-appropriate suggestions to individual customers. Whilst not fully personalised advice, targeted support considers customer-specific information in applying group recommendations.
Technology enablement allows firms to deliver targeted support cost-effectively at scale. Automation, decision trees and AI support efficient processes reaching mass market consumers.
One trial participant reported that targeted support helped customers feel more confident making financial decisions whilst costing substantially less than full regulated advice.
Impact on Advice Firms
AGBR creates both opportunities and challenges for financial advice businesses.
Market expansion opportunities allow firms to serve consumers previously considered uneconomic. Clients with modest investment amounts, straightforward needs or limited budgets become viable through targeted support’s lower cost structure.
Revenue model diversification adds targeted support as a service tier between guidance and full advice. Firms can offer appropriate levels of support based on customer needs and willingness to pay.
Technology investment requirements mean firms must develop or procure systems enabling cost-effective targeted support delivery. This includes customer segmentation, decision support and automated suggestion generation.
Regulatory compliance obligations expand as firms offering targeted support must meet FCA requirements for this service category whilst maintaining existing advice standards.
Competitive dynamics shift as firms offering multiple support tiers may attract customers from competitors providing only traditional advice or guidance.
Business Model Implications
Targeted support changes the economics of serving mass market consumers.
Lower cost per customer enables profitable service delivery for clients with smaller investment amounts. Foresters Financial demonstrates basic advice viability serving customers with a tenth of assets compared to holistic advice firms.
Higher volume potential compensates for lower per-customer revenue. Reaching 21.5 million potential targeted support users creates substantial market opportunity.
Reduced qualification requirements for staff delivering targeted support versus full advice lowers personnel costs. Advisers need fewer qualifications for straightforward product recommendations.
Shorter process times through simplified assessment and decision support reduce time per customer interaction. What might take 90 minutes for full advice could complete in 20 to 30 minutes for targeted support.
Fee structures built into products remove payment barriers. Research shows mass market consumers resist paying separately for advice but accept product-embedded fees.
Technology Requirements
Delivering targeted support cost-effectively requires appropriate technology infrastructure.
Customer segmentation systems analyse client data to assign individuals to appropriate groups based on shared characteristics and needs.
Decision tree automation guides staff through appropriate suggestions based on customer segment and specific circumstances. This ensures consistency and compliance.
AI-powered support can enhance efficiency through automated data extraction, suggestion generation and documentation. Systems trained on financial services provide domain-specific capability.
CRM integration ensures customer information flows seamlessly between systems. Targeted support processes should access fact-finds, previous interactions and account details.
Compliance monitoring tracks that targeted support suggestions remain appropriate, documentation meets standards and outcomes are satisfactory.
One advice firm calculated that technology investment enabling targeted support paid back within 18 months through serving previously uneconomic customer segments.
Regulatory Obligations for Targeted Support
Firms offering targeted support must meet specific FCA requirements distinct from both guidance and advice.
Needs assessment sufficient for segmentation requires understanding customer circumstances enough to assign them to appropriate groups. This is less comprehensive than full advice fact-finding.
Suggestion appropriateness means recommendations must be suitable for the customer segment even without individual assessment. Firms demonstrate that group-based suggestions meet common needs.
Clear communication ensures customers understand they are receiving targeted support, not regulated advice. Firms must explain the service limitations and when customers should seek full advice.
Ongoing monitoring verifies that targeted support delivers good outcomes for customers. Firms track satisfaction, complaints and whether suggestions meet needs.
Consumer Duty obligations apply to targeted support. Firms must ensure this service category delivers fair value and supports good customer outcomes.
Basic Advice Enhancement
AGBR includes provisions making basic advice more accessible and attractive for firms.
Simplified regulatory framework reduces complexity around basic advice delivery. The FCA aims to remove barriers preventing wider adoption.
Expanded use cases clarify what customer needs and products qualify for basic advice. Greater certainty helps firms assess where this approach is appropriate.
Lower entry barriers encourage more firms to offer basic advice. Foresters Financial’s success proves viability but wider adoption could serve more consumers.
Integration with targeted support allows firms to deploy both approaches strategically. Some customers suit basic advice whilst others benefit from targeted support.
Research from Foresters shows basic advice could address 25% of the FCA’s estimated advice gap. Combined with targeted support, these frameworks could dramatically increase access to financial help.
Opportunities for Advice Networks
Large advice networks gain specific advantages from AGBR implementation.
Scale economics improve as technology investment costs spread across more advisers and customers. Networks with 200+ advisers achieve better returns on targeted support infrastructure.
Standardised processes ensure consistent delivery across multiple locations and advisers. Centralised decision support, training and compliance oversight maintain quality.
Brand differentiation occurs when networks offer comprehensive support tiers from guidance through targeted support to full advice. This positions firms as serving all customer segments.
Data advantages from large customer bases improve segmentation accuracy and suggestion quality. Networks understand which approaches work best for different customer groups.
Technology leverage allows networks to invest in sophisticated systems that smaller firms cannot afford independently.
Preparing for Implementation
Firms should begin AGBR preparation now to launch quickly when final rules take effect.
Assess current capabilities including technology, processes and staff skills. Identify gaps preventing targeted support delivery.
Evaluate market opportunity by analysing current customer base for underserved segments and estimating total addressable market in target regions.
Plan technology requirements considering whether to build, buy or partner for needed systems. Evaluate vendors with targeted support solutions.
Develop business models including pricing structures, revenue projections and cost estimates for different support tiers.
Train staff on new frameworks, regulatory requirements and delivery processes. Build capability before launch.
Establish governance including approval processes, quality assurance and outcome monitoring for targeted support services.
Common Questions About AGBR
Firms considering targeted support and basic advice have predictable concerns with emerging answers.
Liability differences between targeted support and regulated advice affect risk management. The FCA clarifies that targeted support carries different obligations than full advice recommendations.
Minimum standards for customer assessment in targeted support require firms to gather sufficient information for appropriate segmentation without full fact-finding.
Technology dependencies raise questions about required versus optional automation. Whilst technology enables scale, the FCA does not mandate specific systems.
Existing advice firms worry about cannibalisation of full advice revenue. Well-designed strategies use targeted support to expand market reach rather than substitute for advice.
Industry Response
Financial services firms and trade bodies have responded positively to AGBR proposals whilst highlighting implementation considerations.
Trial participants including Royal London report that targeted support helped customers feel more confident making financial decisions. This evidence supports the framework’s effectiveness.
Provider commitments demonstrate market appetite with firms announcing targeted support services. Royal London confirmed it will provide targeted support centred on retirement planning.
Implementation concerns focus on technology requirements, regulatory clarity and business model viability. Firms want sufficient detail to invest confidently.
Consumer protection advocates emphasise the importance of clear communication about service limitations and appropriate oversight ensuring good outcomes.
Future Developments
AGBR represents the first phase of regulatory evolution with further developments anticipated.
Regulatory refinement will continue as the FCA monitors targeted support implementation and outcomes. Rules may be adjusted based on practical experience.
Technology advancement will improve targeted support capabilities over time. AI and automation will become more sophisticated and accessible.
Market evolution will see new business models emerge as firms experiment with different approaches to mass market service delivery.
Consumer education will help the public understand different support options and choose appropriate services for their needs.
Frequently Asked Questions
When will targeted support rules take effect? Final rules are expected in early 2026 with implementation likely by late 2026 or early 2027. Firms should begin preparation now.
Can existing advice firms offer both regulated advice and targeted support? Yes. Many firms plan to offer multiple support tiers serving different customer segments and needs appropriately.
What technology is required for targeted support delivery? Customer segmentation, decision support and compliance monitoring are essential. AI-powered automation improves efficiency but specific systems are not mandated.
How does targeted support differ from robo-advice? Targeted support can include human interaction and is based on customer groups rather than pure algorithms. It sits between generic guidance and individual advice.
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