The Financial Conduct Authority (FCA) has published its final rules and regulatory framework for pensions dashboard service (PDS) firms, in what has been highlighted as a "big step forwards" for the programme.

The FCA's rules are split into two broad categories - the "high standards" it expects of all FCA regulated financial services firms, and the requirements that are specific to firms operating a PDS, which are intended to balance risks and opportunities.

In particular, the FCA said that it wants PDS to be platforms where consumers can confidently and positively engage with their pensions and be safely supported in retirement planning, warning that if consumers lose confidence in dashboards, it could risk losing the opportunities dashboards offer and the ability to build on this in the future.

At the same time, however, the watchdog acknowledged that, if its standards are too stringent, it may prevent desirable innovation that helps consumers and deter reputable firms from entering the market, which could limit opportunities for consumers to meaningfully engage with their pensions.

Given this, the FCA said that whilst it considers its framework of rules to be proportionate for the first iteration of dashboards, it can also see the potential for dashboards to develop into, or contribute to, something more sophisticated over time.

Indeed, whilst the framework outlines its expectations for the initial launch of private sector PDS, the FCA recognised the potential for PDS to evolve over time, noting that there are both FCA and government initiatives and workstreams in various stages of development that could change the future landscape in which dashboards operate in future.

It therefore acknowledged that it may need to revisit the regulatory framework for PDS firms to explore how it might interact, support and appropriately protect in those new landscapes.

For instance, the FCA said that it is "open" to reviewing its limitations on whether and how ‘view data’ might be exported in future in the context of the Advice Guidance Boundary
Review (AGBR).

"We also recognise there are cross-cutting regulatory developments in train across both the FCA and government that could change the landscape in which pensions dashboard services operate," it stated.

"In that context we need to explore the important and complex question of whether, how and in what circumstances dashboard data might enable consumers to access mass-market support outside the dashboard. We intend to use the AGBR to start that conversation."

Despite sharing the finalised framework, the FCA confirmed that it is not yet opening the gateway to receive applications for authorisation and variation of permission.

Instead, it said that it will open the gateway only when it is possible for a firm to show that it is ready, willing and organised to undertake the new activity of operating a PDS.

This means that the FCA will only look to open the gateway when the government and Pensions Dashboards Programme (PDP) have produced all the information necessary for a firm to design and build a PDS.

"We will give industry adequate advance notice of the gateway opening, accompanied by the finalised application forms," the FCA confirmed.

The FCA also emphasised more broadly that whilst it is finalising its rules now, in order to give interested parties some certainty over the initial FCA requirements, the launch of private sector dashboards is "still some way into the future", given the PDP's current focus on the Moneyhelper dashboard service.

Despite this, the latest update from the FCA was still hailed as "a big step forwards for the programme" by Standard Life retirement saving director, Mike Ambery.

"The rules provide a degree of regulatory certainty that will allow providers to build the innovative services required to help savers engage with their retirement," he continued.

"However, there are some missed opportunities including a cautious approach to timescales and restrictions on how data can be exported," he added.

"The document does note that these are the initial versions of the rules and there is space in future for iterating and refining, so we look forward to seeing them evolve.”

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