Targeted Support: Reflections on the FCA’s 23rd March Update and How Firms Can Get This Right

What the FCA Reinforced on 23rd March

The FCA set out several expectations that will influence how firms build and refine their targeted support models.

1. Segments must reflect shared customer needs

A segment must be defined by a shared financial need or objective. Demographic information alone is not sufficient.

2. Firms must define both including and excluding characteristics

Clear criteria help determine who should and who should not receive a particular suggestion.

3. Segmentation must be detailed, but proportionate

Segments must be granular enough for firms to judge suitability, without becoming so detailed that they replicate a full advice fact‑find.

4. Complexity drives the level of detail required

Less complex needs, such as investing surplus cash, require fewer characteristics.
More complex situations, such as retirement income planning, require a broader set of characteristics to remain within the targeted support perimeter.

5. Know when targeted support is not appropriate

If a firm cannot make a suitable suggestion without assessing an individual’s specific circumstances, the FCA is clear that targeted support should not be used.

The FCA also confirmed that the Financial Ombudsman Service will take this publication into account when considering what is fair and reasonable in complaints involving targeted support. This increases the importance of designing segmentation, controls and governance frameworks correctly from the outset.

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How Delta Capita Helps Firms Navigate This Safely and Confidently

Targeted support requires a combination of regulatory interpretation, data discipline, conduct governance and operational clarity. Delta Capita supports firms across the sector in building robust, compliant and scalable frameworks.

1. Translating FCA rules into practical, defensible design

We help firms interpret COBS 9B and Consumer Duty requirements and translate them into clear segmentation logic, decision rules and customer journeys that can be operated consistently and evidenced confidently.

2. Building robust, data‑driven segmentation

Our teams design characteristics that are relevant, measurable, consistently applied and aligned to intended customer outcomes.

3. Creating strong governance and boundary controls

We design frameworks that minimise the risk of inadvertently providing personalised advice, supported by documented rationale, traceable decision‑making, outcome monitoring and defined escalation pathways.

4. Supporting firms through FCA engagement

We assist firms preparing for conversations with the FCA, including through the Pre‑Application Support Service. This helps refine propositions and reduce uncertainty prior to formal submission.

5. Designing the end‑to‑end operating model

From customer communications and management information to audit trails, training and control processes, we help firms build operating models that work effectively in practice.

Final Thought

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The FCA’s 23rd March publication represents a clear benchmark. It will guide supervisory oversight and inform how the Ombudsman assesses complaints.

Targeted support offers firms a meaningful opportunity to help customers make better decisions, but only when designed with discipline, clarity and evidence.

Delta Capita is already working with firms to develop targeted support frameworks that meet regulatory expectations and deliver improved customer outcomes. If you are exploring how to introduce targeted support, or enhance an existing model, I would be happy to discuss how we can help.

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