FCA introduces cap on early-exit pension charges

‘Proportionate balance between benefits'

The Financial Conduct Authority (FCA) has announced its final rules on capping early exit charges for consumers eligible to access the government's pension reforms from the age of 55.

In Policy Statement PS16/24: Capping early exit pension charges, the regulator stated that, from 31 March 2017, early exit charges would be capped at 1% of the value of existing contract-based personal pensions, including workplace personal pensions. It added that early exit charges currently set at less than 1% may not be increased and firms will not be able to apply an early exit charge to personal pension contracts entered into after these rules take effect. FCA executive director of strategy and competition Christopher Woolard said: "People eligible for the government's pension re...