The financial services industry is approaching a significant structural turning point. The Financial Conduct Authority’s (FCA) newly introduced “Targeted Support” regime is set to reshape how firms engage with consumers, carving out a regulated middle ground between generic guidance and fully personalised financial advice. The primary goal is to close a long-acknowledged advice gap that leaves millions of people without meaningful investment support.
everyoneINVESTED, a WealthTech supporting the democratisation of wealth management, recently delved into Targeted Support and what it means.
Central to making this regime work is segmentation — a concept that, while familiar to most in the industry, takes on an entirely new level of importance under the new rules. Under Targeted Support, segmentation is no longer simply a tool for marketing teams. It becomes a regulated framework that governs what firms are and are not permitted to do.
Firms must now design ready-made suggestions tailored to groups of consumers who share similar needs and characteristics. These groups must be carefully defined — neither too broad nor too narrow — and must be grounded in a repeatable, evidence-based rationale. Crucially, suitability is assessed before distribution, and governance must be robust enough to withstand regulatory scrutiny.
WealthTech firm everyoneINVESTED argues that most existing segmentation approaches fall short of this standard. The majority of tools in use today rely on self-assessment questionnaires, where users select answers and are assigned to a risk category. The problem, the company contends, is that such methods bake in personal bias from the outset — people tend to answer based on how they perceive themselves, rather than how they actually behave when confronted with genuine financial risk.
everyoneINVESTED takes a different approach. Rather than asking users to describe themselves, its “financial personality test” measures how individuals think when faced with real risk-reward trade-offs. The methodology is rooted in decision science and peer-reviewed research, and it quantifies both rational and emotional drivers on a continuous scale — avoiding the artificial categorisation that questionnaire-based tools typically impose. The result is a behavioural dataset that captures responses to risk, context and loss, which the firm says is interoperable, comparable across populations and suitable for both regulatory and operational purposes.
This distinction carries significant weight under the new regime. The FCA has made clear that segmentation models must be defensible — demonstrating real behavioural differences between groups, meaningful similarities within them, and sufficient granularity to stop short of constituting personalised advice. A model built on observed behavioural metrics, rather than self-declared preferences, is inherently better placed to meet these tests, it said. It can show how each segment was constructed and justify why each individual has been assigned to it.
Beyond regulatory compliance, everyoneINVESTED frames its approach as a strategic differentiator. Firms equipped with stronger behavioural data and more scientifically rigorous segmentation will be better positioned to justify their ready-made suggestions and, more importantly, to engage consumer groups that have historically been excluded from investment conversations altogether.
For more insights into Targeted Support, read the full story here.
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