FCA Policy Statement on Early Exit Charges—the end is nigh for pension charges?

Table of contents

• What was the background to the consultation? What did the Financial Conduct Authority (FCA) propose?
• What concerns were raised by respondents to the consultation?
• What decision has the FCA made in relation to capping/banning early exit charges in personal and stakeholder pensions?
• What types of charges will be caught? Are there any exclusions?
• How and when will the cap/ban be implemented?
• Are there any differences from the cap/ban to be implemented for members of occupational pension schemes?
• How will the imposition of the cap/ban affect the personal pensions market and consumer behaviour?

Article summary

Pensions analysis: With the writing firmly on the wall for early exit charges in pensions, James Borshell, senior associate at Dentons, assesses how and when the industry will react and ponders how the losses from the cap/ban may end up recouped elsewhere.