The Financial Conduct Authority (FCA) has announced a wide set of reforms to strengthen the UK’s investment culture and help consumers take informed risks.
The new rules aim to boost innovation, make investing more engaging for consumers, and simplify regulation by drawing a clear line between retail and professional investors.
“Today’s measures support investment risk culture right along the spectrum. They ensure that firms can compete to give retail customers material that informs and engages them”, said Executive Director of markets at the FCA, Simon Walls.
While retail investment firms will be given more freedom to explain investment risks and returns to consumers, they will also be expected to demonstrate disclosures and outcomes are working effectively.
Moving away from “prescriptive and complex templates that consumers don’t find useful” will also give firms space to innovate and offer a diverse range of products.
The FCA is proposing new exemptions in the future, not removing Consumer Duty obligations now. In CP25/36, firms can opt clients out only when appropriate and still rely on the Consumer Duty for safeguards.
To achieve integrated oversight and a clear line of sight through the investment lifecycle, FinregE transforms complex regulatory change into organised, useful knowledge, equipping businesses with the automation and intelligence they need to confidently and quickly meet these expectations.
What’s changing in the retail investment world
1. Retail investment disclosures are about to get more flexible and scrutinised
The FCA wants to move away from rigid, one-size-fits-all templates that haven’t helped consumers. In practice, this means you can design product information that’s clearer and more engaging, but you still need to cover the essentials: what customers might get back, what it costs, and what could go wrong, in a way people understand.
What to do:
- Redesign disclosures around real customer questions (returns, fees, downside scenarios).
- Build testing and evidence into your process (readability, comprehension, drop-off points).
- Make sure the end-to-end journey still meets Consumer Duty expectations.
2. Get ready for the new CCI regime timeline
In the policy statement PS25/20, the FCA is proposing that the Consumer Composite Investments (CCI) regime will replace existing EU-derived packaged product disclosure rules. Manufacturers will need to produce an easy-to-understand product summary supported by a machine-readable data file, published on a publicly accessible website and updated annually. Distributors will need to highlight key information before sale and provide access to the full product summary, without reformatting manufacturer disclosures.
The transition period starts April 2026, with compliance required from June 2027.
3. Consumer Duty and joint manufacturing: clearer shared responsibilities
In a separate statement. the FCA has clarified expectations where multiple firms jointly manufacture or operate products. Responsibilities do not have to be equal, but they must be explicit, reflect reality, and leave no gaps. Outsourcing does not reduce accountability.
Governance and contractual arrangements may need updating, particularly as expectations around distribution chain oversight increase.
4. Client categorisation reform: a rebalanced line between retail and professional
The FCA is consulting on client categorisation changes that would reduce “tick-box” approaches and increase structured judgement.
Proposals include removing the current trading-frequency test, introducing a new opt-up route for individuals with £10m+ in investable assets (with informed consent), and requiring firms to assess clients using a defined set of qualitative factors (e.g., knowledge, resilience, objectives, loss-bearing capacity).
The consultation is due on 2nd February, 2026.
5. Expanding consumer access: the FCA’s long-term vision for retail investing
The FCA’s discussion paper (DP25/3) signals future direction rather than immediate rule changes. It explores whether the retail framework still fits how people invest today via direct-to-consumer platforms, model portfolios, fractional investing, tokenisation, trading apps and digital engagement.
A key question is whether economically similar products should face more consistent rules, so that protections apply evenly across formats.
The FCA also wants to build a more confident investor base, encouraging informed, prudent risk-taking while tightening approaches to high-risk speculative activity. Over the next few years, expect scrutiny and potential change around digital journeys, risk labels, product governance, suitability, and support for consumers investing without advice.
The discussion paper feedback is due on 6th March 2026.
What actions firms should take
The direction is clear in all four documents. Firms should:
Start a thorough CCI readiness evaluation: Determine whether products fall within the scope, revise disclosures, construct or improve data pipelines, and schedule consumer testing across various channels and personas.
Make joint manufacturing governance stronger: Make sure Duty considerations are properly integrated, revise contractual arrangements, and map obligations from beginning to end.
Rebuild frameworks for client classification: Create new qualitative evaluation procedures, revise onboarding logic, provide team training, and demonstrate customer awareness.
Reassess digital journeys: Evaluate digital engagement practices, nudges, frictions, and decision points, especially in the areas where high-risk products are offered.
Align disclosure regimes: To prevent redundancy and customer misunderstanding, businesses subject to the Sustainability Disclosure Requirements (SDR) should consider how sustainability content fits with new CCI product descriptions.
How FinregE helps firms navigate retail investment regulatory changes
These publications collectively raise the bar for transparency, governance and consumer understanding. FinregE’s regulatory intelligence tools and automation capabilities help firms turn these requirements into practical, repeatable processes.
How we support firms:
- Automated horizon scanning and granular rule mapping across CCI, SDR, Consumer Duty and future categorisation reforms.
- End-to-end disclosure transformation to help firms redesign product summaries, automate machine-readable data, and streamline update cycles.
- Governance mapping across distribution chains, giving firms clarity over roles, responsibilities and oversight duties.
- Operationalising qualitative assessments, enabling firms to translate the FCA’s “Relevant Factors” into consistent, auditable categorisation workflows.
- Consumer journey risk assessments, which pinpoint digital engagement strategies that can draw regulatory attention.
Businesses that begin early and adopt a cross-functional strategy will be in the greatest position to satisfy the FCA’s requirements.
Book a demo today and see how we support end-to-end compliance across the new FCA retail investment landscape.
