Update on Equity Release qualification and permission Update on Equity Release qualification and permission

24 May 2017

Towards the close of 2016, the FCA released a Consultation Paper (CP16/24) looking at the possibility of investment and pension firms without mortgage permissions being able to advise on the equity release market provided they had an adviser who passed either a standalone qualification or a top-up to existing pension and investment qualifications.

  • The FCA has decided not to change the qualifications for equity release at this time
  • The FCA Consultation paper CP16/24 raised the possibility of investment and pension firms without mortgage permissions being able to advise on the equity release market
  • The responses they received did not demonstrate a market need for a change to the appropriate qualification for equity release

However, the responses received by the regulator did not demonstrate a market need for a change to the appropriate qualification for equity release.

This means that ‘investment’ and ‘pension only’ firms will not have the opportunity to include equity release within their advice process and, should a client need arise, will still have to refer to another suitably qualified adviser.

The consultation also addressed the issue of whether it would be beneficial to develop an additional equity release qualification, as the FCA was being told that the current qualification structure might be a barrier to advisers becoming qualified, and so could be limiting consumers’ access to equity release products.

Summary of the feedback
The FCA received mixed feedback on whether there was a market need for a standalone or top-up equity release qualification. Most respondents did not think that an alternative to the current approach would lead to a significant increase in the number of people appropriately qualified, although respondents generally welcomed the aim for consumers to have greater access to equity release and the concept of holistic retirement advice. However, there was widespread acknowledgement around the difficulties in achieving this goal.

Personally, I believe that the issue around equity release permissions isn’t going to just disappear and this area in the market needs to be addressed. I am hopeful that the FCA will re-consider this at some point in the future in order to better equip advisers in providing the full remit of advice when it comes to their clients’ retirement.


Mark Greenwood is Group Regulatory Policy Manager at The SimplyBiz Group


"I left Sesame December 31st 2010 and took up Direct Registration with FSA. My Compliance is now handled by SimplyBiz.

"Firstly, you need to understand that Sesame may not tell you the truth with regard to 'the world outside Sesame' - I would suggest to you that you should believe nothing. If you leave they lose a stream of revenue. They may tell you that the FSA will be making it harder for small businesses operating outside the sphere of the network. Do not believe them.

"What are the advantages of direct authorisation? I'm no longer being treated as lowest common denominator. I have scope to use wider range of research tools. I've seen a twofold plus increase in my written business (it is growing annually.) I receive top class support services, positive meetings for members and have a more positive attitude to business.

"My advice to advisers at the time (the ones I came into contact with anyway) was to exit Sesame at the earliest opportunity and this advice remains still."

Colin Palmer
Colin Palmer Financial Services

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