UK: Targeted support – designing consumer segments

Why should I read this?

The FCA has published guidance on how firms should design consumer segments for targeted support. The guidance, "Targeted support: firm considerations when designing consumer segments", sets out good and poor practice for firms that offer, or plan to offer, targeted support.  Getting segmentation wrong, or failing to monitor it, is one of the biggest risk factors for firms providing targeted support.

The guidance applies to pension providers, platform operators, asset managers and other firms in the retail investment and pension markets, when providing targeted support. 

Targeted support is a regulated activity that sits between generic guidance and regulated financial advice. It was conceived to enable firms to help consumers who do not seek, or cannot afford, personal financial advice – particularly for pension and investment decisions – but would nevertheless benefit from some form of advice.

See our previous client briefings:

• UK: FCA Policy Statement on targeted support – retail investment aspects
• UK: Targeted support for retail customers of financial services firms

What does the FCA consider good and poor practice?

The FCA expects firms to design consumer segments that are meaningful, evidence-based and regularly reviewed.

Predictably, the Consumer Duty will be the benchmark against which the FCA assesses whether targeted support is delivered well.  The FCA, however, draws an important distinction between "better outcomes" (the standard for targeted support) and "good outcomes" (the standard under the Consumer Duty).

Next steps

The targeted support permissions gateway opened in March 2026.  The final rules take effect from 6 April 2026.

Firms that wish to offer targeted support and have not yet engaged with the FCA's pre-application support service (PASS) should consider doing so.  Firms that demonstrate readiness through PASS will receive permission more quickly than those which do not.

How Eversheds Sutherland can help

Eversheds Sutherland advises pension providers, asset managers, platform operators and other investment firms on Consumer Duty compliance, conduct risk and regulatory change.  We can help you design and test your targeted support framework, apply for the necessary permissions and monitor outcomes.  Our regulatory horizon scanning tracks key FCA reforms across pensions, investments and consumer finance.