FCA’s Targeted Support Proposal: What It Means for Advisory Firms and Acquirers
- Chapters Capital
- Jun 30
- 3 min read
30th June 2025
The Financial Conduct Authority (FCA) has announced its long-awaited consultation on "targeted support," a proposal that could transform the way financial planning firms interact with clients who fall outside the traditional realm of regulated advice. While this initiative is positioned as separate from personalised financial advice, targeted support enables firms to recommend actions to specific consumer groups based on shared characteristics. Essentially, it seeks to close the gap between generic guidance and customised advice.
For advisory firms, particularly those facing growth challenges, succession plans, or preparations for acquisition, the implications are substantial. Targeted support offers a scalable and regulatory-compliant method to engage clients who may not yet be ready or financially equipped for full advice. The FCA views this as a "stepping stone," a concept that resonates with firms aiming to build future client pipelines while reducing client acquisition costs.
From an M&A perspective, this development adds another dimension to what makes a firm appealing to potential buyers. Firms that can demonstrate sophisticated and compliant methods for engaging larger pools of prospective clients, especially those previously deemed commercially unviable, are likely to enhance their long-term value. For consolidators and private equity investors, the ability to apply targeted support across multiple acquired firms represents a new strategic opportunity to drive efficiency, retention, and growth.
The research conducted by the FCA underscores both the promise and the challenges of this initiative. While many consumers in pension-focused studies managed to differentiate between targeted support and personalised advice, confusion arose on the investment side. Nearly half of those exposed to investment-related communications mistakenly believed they had received financial advice. These findings underscore the importance of clarity, transparency, and effective educational framing as firms implement targeted communications.
However, there is great potential in this approach. When executed effectively, targeted support can engage traditionally underserved or advice-averse demographics. It enables firms to meet clients where they are by offering targeted nudges, guidance, and product suggestions without exceeding the regulatory thresholds associated with full advice. For business owners considering succession, this creates the possibility of leaving behind an operation that is not only well-managed but also prepared for the future.
The consultation will last for eight weeks, with final rules expected to be established by the end of the year. Concurrently, the FCA will undertake further efforts to simplify the broader advice framework. This suggests a more unified regulatory environment in which firms can navigate various levels of client engagement, ranging from guidance to targeted support to full advice, without unnecessary confusion.
For advisory firms, this is more than just a policy update. It serves as a prompt to consider how evolving regulations can stimulate innovation, differentiation, and ultimately improve valuation. As always, those who act early, communicate effectively, and provide real value at scale are likely to emerge as the winners.
At Chapters Capital, we specialise in financial planning and wealth management M&A and understand the importance of strategic acquisitions for growth. Whether you are considering a sale, merger, or expansion or want to learn more about buyers in the space, please contact one of our professional associates today for a confidential, no-obligation consultation.
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