The Financial Conduct Authority plans to launch a multi-firm review of model portfolio services (MPS) later this year to assess how firms are implementing the Consumer Duty.
The regulator said that MPS have been growing “at pace” in recent years.
In a letter sent to firms, Camille Blackburn, director, wholesale buy-side at the FCA, said: “Though MPS sit outside traditional fund wrappers, these portfolios generally invest in investment funds and asset managers are active in constructing and distributing these services.”
The FCA said the review would provide confidence that investors are receiving good outcomes from MPS and share good practice on how firms are achieving this.
In addition, the regulator will also engage with firms affected by key policy proposals to make its disclosure regime more flexible to support smooth implementation of these proposals.
“Our Advice-Guidance Boundary Review proposals aim to help consumers get the support they need to make informed financial decisions. We see the potential for firms to use targeted support to better engage consumers and help them achieve better outcomes with their savings and investments.
“Our Consumer Composite Investments consultation to transform product disclosures will prioritise good consumer outcomes through a more flexible regime,” Blackburn added.
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