Responding to the Financial Conduct Authority consultation CP24/4 on the regulation of pension dashboard service firms (which closes today), Aegon has called for rules to allow regulated firms to better support consumers along the full journey from viewing data to taking action.
Steven Cameron, Pensions Director at Aegon said:
“Pension dashboards have the potential to create a step change in pension engagement. But to fully capitalise on this opportunity, regulation should allow firms with appropriate permissions to support individuals not just to view their pensions data but crucially to make informed decisions and act on them.
“While the Government has ruled out individuals undertaking transactions on pension dashboards, the FCA regulatory framework will determine how easy or hard it will be for individuals, particularly if not seeking advice, to take that ‘next step’ from viewing data to taking action.
“We appreciate that pension dashboards are a new concept and the FCA must protect consumers from scammers. But where regulated firms are involved, the Consumer Duty adds further regulatory protections to ensure good outcomes. Often, consumers need protecting from their own inertia and if taking action is too complex or daunting, this can lead to poorer outcomes.
“We are concerned about the sharp break in the journey when moving from dashboard to other transactional services a firm may offer. We’d like the FCA to explore allowing consumers to extract data from both ‘view’ and ‘post-view’ services in a form which could then be used in conjunction with ‘off dashboard’ services offered by advisers and other firms with appropriate regulatory permissions.
“Better engagement, prompted by dashboards, could lead to greater consolidation of pots where safe to do so. FCA data shows that it’s small pots which are most likely to be taken as lump sums at retirement. Dashboards offer a great opportunity to encourage more consolidation into larger pots, improving consumer engagement with their journey towards and into retirement.”
