The Financial Conduct Authority (FCA) has published its pension dashboards rules for pension providers, effective 31 August 2023.
FCA regulated pension providers must connect their personal and stakeholder pension schemes to the Money and Pensions Service’s (MaPS’) digital architecture (in line with the service’s standards and guidance), and be ready to receive requests to find pensions, search records for data matches and return informations to consumer pension dashboards.
Pensions dashboards are secure digital interfaces through which information about pensions not yet in payment can be viewed. These will allow consumers to more efficiently plan their requirements and make more informed decisions about their pensions.
Through the new rules, the FCA aims to encourage increased engagement with pensions, digitise the pensions sector and offer greater pension information access. In turn, the FCA predicts that this could drive market competition as consumers will be able to communicate what they want from their pensions.
In 2022, the pensions Policy Institute estimated that more than 2.8 million pension pots are ‘lost’ — meaning that consumers no longer receive provider communications about them. Additionally, according to the FCA’s 2022 Financial Lives Survey, 30 per cent do not know the approximate value of their pension, and 31 per cent cannot recall receiving a provider statement over the past year.
Jonathan Hawkins, principal consultant and pensions specialist at Bravura, says: “The 30-day limit for resolving a partial match will mean stale data or stale partial match data are not retained indefinitely, which is best practice for data stewardship.
“Some providers may find themselves skipping forward now the FCA has clarified how the MaPS Code of Connection relates at the provider level, not the level of the underlying personal or stakeholder scheme. The small end of the market has also been redefined and now includes schemes with fewer than 5000 pots in accumulation.
“There are various waivers that these schemes could use to defer their connection date up until 31 October 2024. Access to this will likely be limited and will only fit certain providers, so it remains to be seen what impact this will have once the finer details are uncovered.”
