Product providers and intermediaries will have the chance to air their views on the 1% charging cap ...
Product providers and intermediaries will have the chance to air their views on the 1% charging cap in relation to the proposed suite of simplified products proposed by Ron Sandler.
The joint Treasury/DWP consultation paper concludes that although the 1% limit is a concept that is "simple to grasp" it also brings with it problems, such as the need for companies to actually make a profit from providing the products.
"The Government therefore welcomes views on the structure and level of a charge cap. Representations will need to demonstrate what benefits a change would bring for the consumer and for market penetration. The Government will be commissioning independent research in order to establish that the cap meets the needs of consumers, industry and Government"
As the new document itself points out, the UK retail financial services industry is worth 120% of GDP in terms of the amount of money invested, meaning the government "has a clear interest in the existence of a successful and efficient financial services sector".
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