FCA opens advice unit to help emerging robo-advisers
The UK’s FCA has opened its Advice Unit which aims to guide emerging robo-advisers and will focus on firms with services which target the advice gap in the market. Firms looking to build robo-platforms can apply for regulatory feedback, through their development phase and guidance to help gain regulatory authorisation quickly. The service is currently free to firms meeting the eligibility criteria although the regulator has said it may consult on an appropriate charging structure after the initial phase. According to a freedom of information request, 39 firms approached the regulator between October 2014 and August 2015 for assistance to set up robo-advisory services.

Firms looking at building robo-advice services can start applying to a new FCA unit to receive the regulator’s guidance on development.

As of yesterday, firms interested in creating their own partly or fully automated advice services have been invited to apply to the Advice Unit, which is part of Project Innovate.

The FCA said it would provide regulatory feedback to firms developing automated models that seek to deliver lower cost advice to consumers.

The FCA stated: “The unit will focus on models that look to serve the gaps in the current market for advice identified by the Financial Advice Market Review.

“The Advice Unit will work with firms developing models that provide a ‘personal recommendation’ or discretionary investment management services for their clients.

“Our focus on ‘automated advice’ includes fully or partly automated online services and other models that use technology to deliver lower cost advice.”

The unit will offer individual regulatory feedback to firms that meet the Advice Unit’s eligibility criteria on their model.

The FCA said feedback provided by the unit could include:

• an initial meeting with the Advice Unit, and other specialist areas of the FCA if needed, to discuss the proposition

• for firms requesting ongoing engagement, a dedicated point of contact within the Advice Unit to provide regulatory input at agreed milestones

• specific feedback on the regulatory implications of the model using the tools available to the FCA. This could include follow-up meetings with relevant FCA staff to discuss specific issues, informal steers, and potentially individual guidance as appropriate.

• end to end authorisations support if a firm is currently unauthorised.

Furthermore, it said it will look use the experiences it gains with individual firms and publish resources for all firms developing automated advice propositions.

The FCA is not charging any additional fees to firms meeting its eligibility criteria during the initial phase of the operation but it will evaluate the impact and costs of running the unit and may consult on “an appropriate charging structure”.

Anyone looking for more information before applying can email This email address is being protected from spambots. You need JavaScript enabled to view it. or call 020 7066 0075.