ESMA sets out actions to simplify the retail investor journey and make investing more accessible

Taking into account the input from stakeholders, ESMA outlines a number of actions and operational improvements it will take forward to make it easier for retail investors to access suitable investment opportunities.  

ESMA will focus on three areas:

• streamlining disclosure requirements and tackling information overload for investors;
• reducing complexity in suitability and appropriateness assessments;
• simplifying MiFID II requirements on sustainability preferences.

As part of this follow up work, consumer testing will be used to inform and validate improvements to disclosures and digital investor journeys, including for mobile-first users.

Verena Ross, ESMA Chair, said: 

“Enhancing the investor journey is one of ESMA’s flagship projects to facilitate simplification and reduce burden for participants in financial markets. ESMA will take forward concrete work to make it easier for retail investors to participate in the EU capital markets. 

This work must remain a priority and requires ESMA to work in a joint effort with market participants, the European Commission, co‑legislators and national governments to improve retail investor access.”

Responses indicate that retail investors encounter multiple regulatory and non‑regulatory barriers when starting to invest. There is therefore not one magic solution to make the EU’s capital markets more accessible.

Stakeholders highlighted the following aspects to be addressed:

Disclosures: too long, too complex, not digital-first. Stakeholders support the need for appropriate disclosures but find them not sufficiently effective due to volume, complexity, and fragmentation of information. They call for clearer and layered information, delivered in mobile-friendly formats.

Suitability and appropriateness assessments: valuable but heavy. Stakeholders value the investor protection benefits of suitability and appropriateness requirements, but ask for simplification and proportionality, particularly for simple products and those distributed through digital channels. Many also consider the integration of sustainability preferences as being overly complex. 

Beyond regulation: trust, costs, and taxes matter. Respondents also highlighted several non-regulatory obstacles to investing: lack of trust, high fees and limited comparability of products, low financial literacy and cultural factors, and complex taxation, especially for cross-border investments.

Next steps      

The report will guide ESMA’s future technical advice on MiFID II delegated acts and potential updates to its guidelines, ensuring alignment with the final outcome of the Retail Investment Strategy (RIS).

Further information:

Iris Hude

Communications Officer
press@esma.europa.eu